Question 7A young entrepreneur owes his bank thefollowing obligations, (1) Php75,000 due at the endof one year without interest and (2) Php120,000due at the end of three years with interest at 12%compounded semi-annually. What is the value ofobligation (2) at the end of 2 years? What singlepayment at the end of 2 years would settle the twoobligations? Money's worth is 12% compoundedmonthly.The value of obligation (2) at the end of 2 yearsis Php151,063.64. The single payment at theend of 2 years is Php226,063.64.The value of obligation (2) at the end of 2 yearsis Php151,063.64. The single payment at theend of 2 years is Php235,575.52.The value of obligation (2) at the end of 2 yearsis Php151,834.85. The single payment at theend of 2 years is Php226,834.85.The value of obligation (2) at the end of 2 yearsis Php151,834.85. The single payment at theend of 2 years is Php236,346.72.

First let us list down the steps and formula to solve.1. Determine the FV of the loan amount in year…

Answered: A young entrepreneur owes his bank the…

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 2STP

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