Mrs. Lim's purchase contract for a house and lot specifies that she will pay $500,000 cash and $45,000 the end of each month for 10 years at the interest rate of 17% converted monthly. What is the cash va of the house and lot? Round off answer to the nearest peso.

Mrs. Lim's purchase contract for a house and lot specifies that she will pay $500,000 cash and $45,000 the end of each month for 10 years at the interest rate of 17% converted monthly. What is the cash va of the house and lot? Round off answer to the nearest peso.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 25PROB

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

Mrs. Lim's purchase contract for a house and lot specifies that she will pay $500,000 cash and $45,000 at
the end of each month for 10 years at the interest rate of 17% converted monthly. What is the cash value
of the house and lot? Round off answer to the nearest peso.

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