Mr. Limpiado received two offers on a lot that he wants to sell. First Offer: Php 20,000 down payment and a Php 800,000 lump sum payment 6 years from now. Second Offer: Php 25,000 down payment plus Php 30,000 every quarter for 6 years. Both money earns at 6.5% compounded annually. What is the fair market value of the 2nd offer if the focal date is at the start of the term?"

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
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Mr. Limpiado received two offers on
a lot that he wants to sell. First Offer:
Php 20,000 down payment anda
Php 800,000 lump sum payment 6
years from now. Second Offer: Php
25,000 down payment plus Php
30.000 every quarter for 6 years.
Both money earns at 6.5%
compounded annually. What is the
fair market value of the 2nd offer if
the focal date is at the start of the
term?
A. Php 619, 897.79
B. Php 610, 945.79
C. Php 583, 499.79
O D. Php 574, 598.79
Transcribed Image Text:Mr. Limpiado received two offers on a lot that he wants to sell. First Offer: Php 20,000 down payment anda Php 800,000 lump sum payment 6 years from now. Second Offer: Php 25,000 down payment plus Php 30.000 every quarter for 6 years. Both money earns at 6.5% compounded annually. What is the fair market value of the 2nd offer if the focal date is at the start of the term? A. Php 619, 897.79 B. Php 610, 945.79 C. Php 583, 499.79 O D. Php 574, 598.79
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