An amortization of a debt is in a form of a gradient series of P10,000 on the first year, P9,500 on the second year, P9,000 on the third year, P8,500 on the fourth year. Determine the equivalent present worth of the debt if interest is 0.19. Use one of the following formulas. Show complete solution.
An amortization of a debt is in a form of a gradient series of P10,000 on the first year, P9,500 on the second year, P9,000 on the third year, P8,500 on the fourth year. Determine the equivalent present worth of the debt if interest is 0.19. Use one of the following formulas. Show complete solution.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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An amortization of a debt is in a form of a gradient series of P10,000 on the first year, P9,500 on the second year, P9,000 on the third year, P8,500 on the fourth year. Determine the equivalent present worth of the debt if interest is 0.19.
Use one of the following formulas. Show complete solution.
![Arithmetic Gradient Formulas:
A G (A/G, 1%, n)
PG (P/G, 1%, n)
F=G (F/G, 1%, n)
P =
W =
P =
A =
= G | -
Cn
1+r
P =
C -1-wn
1+i 1-w
F =
Geometric Gradient Formulas:
1+r
1 + i
Gr1-(1+i)-¹
i
n
(1+i)"-1
Gr(1+i)" -1
i
i
-) ifw # 1
if w = 1
]
n
(1+i)".
-n]](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F56fbdcdf-2f89-43b2-a0d3-57c660d752fd%2F789d38bd-3991-4d0e-9859-52c7b6bc9c97%2Ff30adqt_processed.png&w=3840&q=75)
Transcribed Image Text:Arithmetic Gradient Formulas:
A G (A/G, 1%, n)
PG (P/G, 1%, n)
F=G (F/G, 1%, n)
P =
W =
P =
A =
= G | -
Cn
1+r
P =
C -1-wn
1+i 1-w
F =
Geometric Gradient Formulas:
1+r
1 + i
Gr1-(1+i)-¹
i
n
(1+i)"-1
Gr(1+i)" -1
i
i
-) ifw # 1
if w = 1
]
n
(1+i)".
-n]
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