. A building is to be paid indefinitely at the rate of 7%. The building's price is P1M if paid in cash. What is the amount of the building today for 12years at the rate of 4.83% compounded continuously?

. A building is to be paid indefinitely at the rate of 7%. The building's price is P1M if paid in cash. What is the amount of the building today for 12years at the rate of 4.83% compounded continuously?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: A present amount of 5300 is invested into an account, which can be withdrawn after the end of 12.8…

A: The equivalent uniform annuity would be equivalent to growing annuity when both present value are…

Q: 3. Don Blaza bought a property for 300,000 down payment and the balance in 10 deferred semi-annual…

A: Here we calculate the given by following method as follow;

Q: 14. Audrey buys a piece of lot for P160,000 down payment and 12 deferred semi-annual payments of…

A: The entrance and outflow of cash and cash equivalents are referred to as cash flow. The cash flow of…

Q: For an interest rate of 10% compounded annually, evaluate the value of "X" from the cash flows given…

A: Compound interest is often referred to as "interest on interest." It's the concept of earning…

Q: Compute for the effective interest rate every 3 months of the nominal rate us 16.66% compounded…

A: The effective interest is generally higher than the nominal rate because it will be calculated with…

Q: 5. Find the present value of an annuity of P30,000 payable annually for 10 years with the first…

A: * SOLUTION :- (5)

Q: A man borrowed P 1,000 which will be paid after 10 years at an interest rate of 12% compounded…

A: In order to solve the above problem we use the following formulas and logic: 1. We find the future…

Q: A merchant wants to have P2,000 to a small business for a period of 6 years. With a given interest…

A: here by using the compound interest formula will find the how much merchant invest , so calculation…

Q: Five P3,300 payments made over a period of five years invested at 5% interest. what is the present…

A: The data presented in the question above is as follows:- PMT or the annual payment = 3300 Interest =…

Q: What are the present worth and the accumulated amount of a 12-year annuity paying BD 25,000 at the…

A: The present worth is calculated using the formula Present value = Annuity ×1+iN-1i1+iN Given the…

Q: Fishing Designs has arranged to borrow $12,000 today at 15% interest. The loan is to be repaid with…

A: Present discounted value (PDV) is the value of a future cash flow or series of cash flows in today's…

Q: -What is the present worth of two 500 payments at the end of the fourth year and fifth year, if the…

A: Note: Since you have asked multiple question, we will solve the first question for you. If you want…

Q: An investment of P2880 is made at the beginning of each month for 9 years and 4 months. How much…

A: We have given that the investment is made at the beginning of each month and A =₱2880 Length of…

Q: What is the present worth of a 3-year annuity paying 3,500.00 at the end of each year, with interest…

A: Present value is that the thought that states associate degree quantity of cash these days is price…

Q: of a lease contract are as follows: Annual lease = 1,500,000 pesos, 1st payme by 10% each year for 4…

Q: A man agrees to make equal payments at the beginning of each 3 months for 10 years to discharge a…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: The value of annual(A) uniform payments over years 1-5 is equivalent to a payment schedule of 200,…

A: The time value of money refers to the concept that money you have now is worth more than the same…

Q: You have a student loan with a 10% APR, compounded monthly, and a $27,000 balance. You plan to pay…

A: Nominal interest rate =10%. per year compounded monthly.Loan balance (P) =$27,000Total number of…

Q: deposits increasing at a constant rate of 2.7% are made at the end of each year. The first deposit…

A: Initial deposit (P) = 1349Growth rate (g) = 2.7% (converted to decimal: 0.027)Interest rate (i) =…

Q: A man pays his debt in the following manner: P1000 after 1 yr., and decreases P99 every year up to 6…

A: Accumulated value is the total amount an investment presently holds, together with of invested…

Q: On the day his son was born, a father deposited to a trust company a sufficient amount of money so…

A: A lender charges a borrower an interest rate that is a percentage of the principal (the amount…

Q: An employee wants to retire and receive P5000 a month. She wants to pass this monthly payment to…

A: Given, Monthly payments = P 5,000 Interest rate = 8% compounded annually

Q: 4. Find the nominal rate of 22% compounded every 3 months

A: Nominal rate of interest is one kind of interest in which the interest rate is calculated without…

Q: You deposit $600 today in a savings account that earns 4.75% compounded quarterly and leave the…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: Find the present value of an annuity due of P1,200.00 paid every 6 months for 5 years at 7%…

Q: What are the present worth and the accumulated amount of a 12-year annuity paying BD 25,000 at the…

A: Given: The amount of annuity is = BD 25,000 Years = 12 The rate of interest is = 18% compounded…

Q: In order to go to college, Lucy borrowed money from Happy 3 years ago. She borrowed a sum of…

A: Amount borrowed P = 50,000 Interest rate R = 5% Time T = 8 years…

Q: Assume that you save 10,000USD on the 1st day of every month. Under the monthly 7% compound…

A: The balance on the first day of the 7th month can be calculated by the following formula. Amount =…

Q: A businessman invest P 100,000 now and received two payments of P 102,139 at the end of the 3rd year…

A: Given the information: Present value = P100000 Payment at the end of 3rd year = P102139 Payment at…

Q: A man borrowed P180,000 from a lending firm for 6 years at 9% compounded quarterly. At the end of 6…

A: A cash flow diagram is a financial tool that represents the cash flow associated with the project or…

Q: 1. Determine the present worth and the accumulated amount of an annuity consisting of 6 payments of…

A: Given: The annuity amount is = P120,000 Payment time = 6 years The rate of compound = 15% To Find:…

Q: You would like to have $800,000 in your retirement account in 40 years. You assume your retirement…

A: When individuals who have earned incomes have a separate account that they wish to save for the…

Q: 8. A young man has decided to go into a business at age 40. He wishes to accumulate P200,000 at that…

A: Given: The future value amount is = P200,000 The deposit increases by = 10% each year The interest…

Q: What is the present equivalent of a uniform series of quarterly payments of $4,500 each for 8 years…

A: This cash flow contains two uniform series, one is $4500 paid quarterly for the first 8 years and…

Q: A payment of $26,000 is due today. What three equal payments, one in 3 years, one in 4 years, and…

A: Present value is the value of investment in today's dollar. Future value is the value of investment…

Q: If $11,500 per quarter is invested in an account that earns a nominal annual interest rate of 9%…

A: Compounding refers to the process of generating interest on an investment over a usual period of…

Q: Compute the effective interest rate and the amount that Mr. David will have in 15 years if P5,000 is…

A: The effective interest rate on a credit or monetary item rehashed from the ostensible financing cost…

Question

• A building is to be paid indefinitely at the rate of 7%. The building's price is P1M if
paid in cash. What is the amount of the building today for 12years at the rate of
4.83% compounded continuously?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Define Cash flow

VIEW

Step 2: Calculate the value of building

VIEW

Solution

VIEW

Step by step

Solved in 3 steps with 5 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Money borrowed today is to be paid in 6 equal payments at the end of 6 quarters. If the interest is 12% compounded quarterly. How much was initially borrowed if quarterly payment is P200,000.
Situation : Compute the interest for an amount of P 400,000 for a period of 7 years. 9. If it was made at 6.9% compounded bi-monthly.
Show the formula and solution neatly. Due and Perpetuity What is the current value of a P 200.00 annuity be made at the beginning of each year, for 3 years if the prevailing rate of interest is 7% compounded annually?
2. Find the quarterly payment for 21 quarters to discharge an obligation of P120,000 if money is worth 4% compounded 2 quarterly and the first payment is due at the end of 3 years and 9 months.
The two cash flows A and B shown below diagram are said to be equivalent at 8% interest compounded annually. Find the unknown value of C that satisfies the equivalence. 1000 1500 2000 2500 3000 0 1 2 3 4 0 1 2 3 4 A のこ 500 B
7. Five equal deposits of $8000 will be made every 3 years starting next year at %12 per year compounded quarterly. What will be the total accrued amount withdrawn 4 years after the last deposit is made?
In an account earning 8% nominal interest compounded bimonthly. How much should be deposited now to accumulate $9052 after 13 years? Select ono
What amount will be required to purchase, on an enginneer's 40th birthday, an annuity to provide him with 25equal semiannual payments of $10,000 each, the first to be recieved on his 60th birthday, if nominal interest is 4% compounded semiannually?
A total of $54,000 is borrowed and repaid with 48 monthly payments, with the first payment occurring one month after receipt of the $54,000. The stated interest rate is 8.50% compounded quarterly. What monthly payment is required? Please answer correct calculation asap plz Don't answer by pen paper plz
The interest rate given is 12% compounded per year, first convert it to interest compounded monthly
What is the present worth of the following end-of-period semi-annual payments? Money earns an interest of 12% compounded semi-annually. Schedule of payments: Year 1-Year 2 ---zero payment; Year 3-5 ----P10,000 every semester.
The term of a lease contract are as follows: Annual lease = ₱ 1.50M, first payment upon start of thelease, annual lease increase by 10% each year for 4 years. A single lump sum payment is acceptable atthe start of the lease based on an interest rate of 14 % compounded annually. Find the amount of thislump sum.