4. A businessman wishes to raise P1.5 million in five years by investing a fixed amount of money every end of the year for three years. What is the required investment using an interest rate of 8%? A. P635,740 B. P547,630 C. P475,360 D. P396,134

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Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.