An IOU agreement was made between two persons. For a face value of P100,000, it was agreed that the borrower will make 8 annual payments at a 10.50% interest rate. The first payment will be due at the end of the year. It was also agreed that 90% of the face value will be paid for redemption. What is the bond value if it yields at a rate of 12%?
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.
An IOU agreement was made between two persons. For a face value of P100,000, it was agreed that the borrower
will make 8 annual payments at a 10.50% interest rate. The first payment will be due at the end of the year. It was
also agreed that 90% of the face value will be paid for redemption. What is the bond value if it yields at a rate of
12%?
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