A property cost P100k with resale value at the end of 7" year of P5k. Determine book value at the end of year 4 using Matheson Method.Select one:a. P18,049.178b. P18,940.178c. P49.018.187d. P45,094.187

Matheson Method-This is also known as constant percentage method. Data given::> Cost of…

Answered: th A property cost P100k with resale…

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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A builder is offering $131,554 loans for his properties at 9 percent for 25 years. Monthly payments are based on current market rates of 9.5 percent and are to be fully amortized over 25 years. The property would normally sell for $140,000 without any special financing. Required: a. At what price should the builder sell the properties to earn, in effect, the market rate of interest on the loan? Assume that the buyer would have the loan for the entire term of 25 years. b. At what price should the builder sell the properties to earn, in effect, the market rate of interest on the loan if the property is resold after 10 years and the loan repaid? Complete this question by entering your answers in the tabs below. Required A Required B At what price should the builder sell the properties to earn, in effect, the market rate of interest on the loan? Assume that the buyer would have the loan for the entire term of 25 years. (Do not round intermediate calculations. Round your final answer to the…
D1.
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th A property cost P100k with resale value at the end of 7" year of P5k. Determine book value at the end of year 4 using Matheson Method. Select one: a. P18,049.178 b. P18,940.178 c. P49.018.187 d. P45,094.187