The buyer of a certain machine is given 2 options to pay it: 1st option is paying it P405,551 down payment and P274,609 monthly for the next 6 year, starting a month from now; 2nd option is to pay it P350,000 down payment and P200,000 annually for the next 5 years. If the money is worth 21% compounded monthly, what is the present value of the 1st option?

Q: The winner can choose to receive a lump sum of $1,000,000 now or annual payments of $50,000 for next…

A: A study that proves that the 1value of money today is higher than the future value of money is term…

Q: Asset XYZ is selling for $200 in the cash market. Asset XYZ pays the holder $16 per year in…

A: Selling price or Spot price(S) is $200 Dividend Per year is $16, 3 month interest rate(r) is 6% per…

Q: You are promised an 8 year streams of income from buying a new technology at the initial amount of…

A: Step 1 Given a certain rate of return, present value (PV) is the current value of a prospective…

Q: A firm is scheduled to receive payment of $32,000 in 2 years. What is the present value of this…

A: To calculate the present value we will use the below formula   Present value = FV/[1+(r/m)]n*m Where…

Q: A house and lot package is available at P27,000.00 mònthly payable in 20 years. The first payment is…

A: Present value of annuity is the stream of cash flows that are required to be invested today in order…

Q: ries of 6 year-end payments of $400,000. If Simes has a cost of capital of 9%, which form of payment…

A: Present value of money today of the future payments should be more than cash amount today to justify…

Q: If you think you can sell an asset for $15,000 in eight (8) years and you think the appropriate…

A: Amount that would be willing to pay for the asset today = present value of future cash inflows

Q: . What was the final payment if the interest was 20% ?

A: Loan Payment: It is the amount paid on the loan taken from the borrower. This payment includes the…

Q: A condominium unit can be bought at a down payment of P150,000 and a monthly payment of P 23,347 for…

A: The present value of the annuity is the current worth of a cash flow series at a certain rate of…

Q: A store manager plans to exchange his old computer at the end of four years for a newer one worth…

A: The future value of the annuity is the total value of all the payments which is occurred regularly…

Q: A certain piece of equipment has a list price of $120,000.  The manufacturer offers two options for…

A: Option A: Cost of Equipment = $120,000 Down payment = $20,000 Loan amount = $120000-$20000 = $100000…

Q: Mr. Barela's monthly amortization is P3,500 payable at the end of each month. His house and lot will…

A: Maturity value is defined as an amount payable to the investor at the end of the holding period of…

Q: A PIECE OF MACHINERY CAN BE  BOUGHT FOR P10,000.00 CASH OR FOR P2,000.00 DOWN AND PAYMENTS OF P750…

A: This question is based on the concept of internal rate of return, where the interest rate is hidden…

Q: Peter Lynchpin wants to sell you an investment contract that pays equal $13,500 amounts at the end…

A: Value we pay today is present value of cashflows

Q: A house and lot are worth ₱4.3 million in cash. A buyer pays a 40% down payment and agrees to pay…

A: Total Worth = 4,300,000 Down Payment = 40% of Total Worth = 40%*4,300,000 = 1,720,000 Loan Amount =…

Q: The price of T.V set is worth 20,000.00 that needs to be paid in 20 installment of 1000.00 each. If…

A: The installments method will require to borrower to pay the amount borrowed over the period of time.…

Q: pay Cashbox Ltd has the option of buying a new computer system or 5 payments of $85000 each to be…

A: Present value would be the equivalent value of money today considering the time and interest rate…

Q: TA Corp. has a consulting contract with a firm that states that he will receive annual payments of…

A: We need to use present value of annuity due(payment due at beginning of year) formula for…

Q: You can purchase an equipment for $4,000. The equipment will provide benefits worth $900 a year. The…

A: We'll compare the price per year with the present value of cash inflows in order to arrive at a…

Q: For item (13) A car is to be purchased in monthly payments of P17,000 for 4 years starting at the…

A: Present value of any loan or borrowing is the sum of the down payment initially and the value of…

Q: You are considering purchasing an investment contract that will eventually pay you $4000 per year at…

A: Price we should pay is present value of cash flows

Q: The buyer of a certain machine may pay either P50k cash down payment & P10k annually for the next 6…

A:

Q: Michael had to make a payment of $2,750 in 10 months and $2,300 in 20 months, to a raw material…

A: Payment in 10 months (P1) = $2750 Payment in 20 months (P2) = $2300 Let the settlement payment in 4…

Q: Mr. Limpiado received two offers on a lot that he wants to sell. First Offer: Php 20,000 down…

A: As per our protocol we provide solution to the one question only but you have asked two questions…

Q: Cromwell is acquiring some land for $1,200,000 in exchange for semiannual payments of $75,000 at an…

A: Given information: Value of land : $1,200,000 Semi-annual payments : $75,000 Interest rate : 6.35%

Q: The price of T.V set is worth 20,000.00 that needs to be paid in 20 installments of 1000.00 each. If…

A: Following is the answer to the question

Q: With a selling price $140,000, a 20% down payment, and interest at 10 1/2% for 25 years, calculate…

A: Given information: Selling price of mortgage is $140,000 Down payment is 20% Interest rate is 10.5%…

Q: The buyer of a certain machine may pay either P50k cash down payment & P10k each for the next 6…

A: We need to compute present value of both the options and option with lowest present value shall be…

Q: Your uncle is offering you a deal: - To pay you at the end of every month, 1000EUR, during 15 years…

A: Calculation of the value of the each option :

Q: A mining company plans to purchase a small loader for R240 000. They will pay it off in 24 equal…

A: Cash price (PV) = R 240000 Number of monthly payments (n) = 24 Annual interest rate = 18% Monthly…

Q: If an investment of P750,000 that matures in 15 years but with certain specification that P 500000…

A: We are required to find out the return on its maturity and to choose which is the best option. There…

Q: Live Forever Life Insurace Co. is selling a perpetuity contract that pays $1,000 monthly. The…

A: Calculate the monthly rate of return as follows:

Q: An investor paid PhP1,500 for a P1,153 that pays PhP89 a year. If the interest is to be 10%, how…

A: Coupon (C) = Php 89 Price = Php 1500 r = 10% n = 6 years Redemption price = R

Q: if you hold a valid contract that will pay you $8,000 cash10 years from now and the going rate of…

A: Present value of a contract is the discounted value of the payments or receipts which would incur…

Q: You have received two offers on a building lot that you want to sell. Ms. A ’s offer is $20,000 down…

A: The two offers described in the question have completely different cash streams. Hence the present…

Q: An investor agrees to pay R1500 amount after 13 years. In return he will receive R10 000 in 10 years…

A: Payments = R1500 immediately R3000 after 7 years R X(Let) after 13 years Interest Rate 7% for 1st 5…

Q: 3. A certain investment will pay you $50 at the end of every 6 months for 17 years. At the end of…

A: formula for present value of annuity (PVA): PVA=A×1-11+rmm×nrm present value  of lumpsum amount:…

Q: Suppose you paid 5900 pesos as a down payment on a MIO SPORTY motorcycle. The remaining balance is…

A: Present value can be found by the interest rate and given period by calculating the present value.

Q: Mr. Limpiado received two offers on a lot that he wants to sell. First Offer: Php 20,000 down…

A: Note: All the Given  Options are incorrect, so we are solving the correct one for you as per the…

Q: The owner of the firm expects to make a profit of K100 for each of the two years and be able to sell…

A: Value of the firm =Cash Inflows * Present value of discounting factor(rate%,time period) = Cash…

Q: You were offered RM2075.30, 10 years from now in return for an investment of RM800. Calculate the…

A: Time Value of Money stattes that a dollar today is worth more than a dollar sometime later. This is…

Q: Live Forever Life Insurancce Co. is selling a perpetuity contract that pays $1,400 monthly. The…

A: Perpetuity is a form of annuity which receives or pays for indefinite period of time. This is done…

Q: Cromwell is acquiring some land for $1,200,000 in exchange for semiannual payments of $75,000 at an…

A: Given: Land value (PV)= $1,200,000 Payments(PMT) = $75,000 Interest rate (I/Y) = 6.35%

Q: You want to buy a new sports car from Muscle Motors for $87,000. The contract is in the form of a…

A: Here, To Find: Monthly payment =?

Q: a condominium unit is available at 29,000 monthly payable in 20 years. The first payment is due in 2…

A: The cash value for the condominium is the present value of $29,000 annuity which will be discounted…

Q: A new car will cost $24,000 to buy and $5500 annually to operate. If it is sold for $9300 after 6…

A: EUAC is the equivalent annual cost of operating machinery it includes initial cost and an annual…

Q: You have just purchased a six-month, $550,000 negotiable CD, which will pay a 8.5 percent annual…

A: CD (Certificate of Deposit): A certificate of deposit is a safe debt instrument with very low or no…