2. ABC Realty sold a piecę of land for P250,000. A down payment of P50,000 was made and the remainder is to be paid in equal semiannual installments, the first due 6 months after the date of sale. The interest is 8% compounded semiannually and the debt is to be amortized in 5 years. a. How much semiannual payment is required? b. What will the total amount of the payment be? c. How much interest will be paid?
2. ABC Realty sold a piecę of land for P250,000. A down payment of P50,000 was made and the remainder is to be paid in equal semiannual installments, the first due 6 months after the date of sale. The interest is 8% compounded semiannually and the debt is to be amortized in 5 years. a. How much semiannual payment is required? b. What will the total amount of the payment be? c. How much interest will be paid?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
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Transcribed Image Text:2. ABC Realty sold a piece of land for P250,000. A down payment of P50,000 was
made and the remainder is to be paid in equal semiannual installments, the first
due 6 months after the date of sale. The interest is 8% compounded
semiannually and the debt is to be amortized in 5 years.
a. How much semiannual payment is required?
b. What will the total amount of the payment be?
c. How much interest will be paid?
d. What is the total cost of the property?
e. Prepare an amortization schedule for the present value of the loan after making
the down payment.
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