EQUIVALENT RATES What is the present worth of P3000 deposited quarterly for 5 years if the interest is 10% compounded monthly? Adding sensitivity to the analysis - the deposit is made quarterly and yet the interest is compounded monthly. First solve the equivalent rates following the period of annuity, which is quarterly. (1+ )' – 1= (1+ )*-1 r = 10.08% hence - i= 2.52% (1+.0252)-(5* .0252 P = P3000 P46,679.25 Student Assessment Question 1. Compute for the future worth of the sample. If you are the one, will you decide the same? Why
EQUIVALENT RATES What is the present worth of P3000 deposited quarterly for 5 years if the interest is 10% compounded monthly? Adding sensitivity to the analysis - the deposit is made quarterly and yet the interest is compounded monthly. First solve the equivalent rates following the period of annuity, which is quarterly. (1+ )' – 1= (1+ )*-1 r = 10.08% hence - i= 2.52% (1+.0252)-(5* .0252 P = P3000 P46,679.25 Student Assessment Question 1. Compute for the future worth of the sample. If you are the one, will you decide the same? Why
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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Transcribed Image Text:EQUIVALENT RATES
What is the present worth of P3000 deposited quarterly for 5 years if the
interest is 10% compounded monthly?
Adding sensitivity to the analysis - the deposit is made quarterly and yet the
interest is compounded monthly.
First solve the equivalent rates following the period of annuity, which is quarterly.
(1 + )^- 1
= (1+ 10) - 1
r = 10.08%
hence - i = 2.52%
(5*4)기
[1- (1+.0252)¯
.0252
P = P3000
= P46,679.25
Student Assessment Question
1. Compute for the future worth of the sample. If you are the one,
will you decide the same? Why
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