Tiêu đề MSTE 23 Solutions.pdf ✅

23 Econ: Annuity Solutions ▣ 1. A person borrowed Php 500000 at an interest rate of 18% compounded monthly. Monthly payments of Php 12968.31 are agreed upon. The length of the loan in months is closest to: [SOLUTION] P = A [ 1 − (1 + i) −n i ] 500000 = 12968.31 [ 1 − (1 + 0.18 12 ) −n 0.18 12 ] n ≈ 58 months ▣ 2. A mechanical contractor is trying to calculate the present worth of personnel salaries over the next five years. He has four employees whose combined salaries through the end of this year are $ 150 000. If he expects to give each employee a raise of 5% each year, the present worth of his employee’s salaries at an interest rate of 12% per year is ... ? [SOLUTION] P = A 1 + i [ 1 − ( 1 + g 1 + i ) n 1 − 1 + g 1 + i ] P = 150000 1 + 0.12 [ 1 − ( 1 + 0.05 1 + 0.12) 5 1 − 1 + 0.05 1 + 0.12 ] P = Php 591007.64 ▣ 3. A woman avails an investment plan wherein she would pay a certain amount and receive Php 5000 in perpetuity 4 years after her first payment. What was the amount that she invested? Money is worth 5%. [SOLUTION] P = 5000 0.05 (1 + 0.05) −3 P = Php 86 383.76