Solve the problem using the given formula: FUTURE F = A A = F P = A [(1 + i)" PRESENT [1 − A = P ( [(1 + i)* − 1] (1+)") t [1 − (1 + i)"] ANNUITY DUE [(1 + ()-1-1) P=A i(1+)-1 [(1+1)+¹- F=A +A PERPETUITY P=4 -A DEFFERED ANNUITY [1+(1+1) Po=A (1 + i)-n A coffee maker set is offered for sale for P 15 000 down payment and P 1 500 every 3 months for the balance for 15 months. If interest is to be computed at 10% compounded quarterly. What is the cash price equivalent of the set?

Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 1Q
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Solve the problem using the given formula:
FUTURE
F = A
A = F
[(1 + i)" − 1]
−
A
(1 + i)*
PRESENT
P = A
1- (1 + i)"]
= P₁[₁ − ( 1 + D) ³)
ANNUITY DUE
P=A
F=A
[(1+)-1-1
i(1+i)n-1
P=
[(1 + 1)²+¹
PERPETUITY
+A
DEFFERED ANNUITY
[1+(1+i)"]
-4 +
Po = A
<-A
(1+i)n
A coffee maker set is offered for sale for 15 000 down payment and P 1 500 every 3 months for
the balance for 15 months. If interest is to be computed at 10% compounded quarterly. What is the
cash price equivalent of the set?
Transcribed Image Text:Solve the problem using the given formula: FUTURE F = A A = F [(1 + i)" − 1] − A (1 + i)* PRESENT P = A 1- (1 + i)"] = P₁[₁ − ( 1 + D) ³) ANNUITY DUE P=A F=A [(1+)-1-1 i(1+i)n-1 P= [(1 + 1)²+¹ PERPETUITY +A DEFFERED ANNUITY [1+(1+i)"] -4 + Po = A <-A (1+i)n A coffee maker set is offered for sale for 15 000 down payment and P 1 500 every 3 months for the balance for 15 months. If interest is to be computed at 10% compounded quarterly. What is the cash price equivalent of the set?
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