question archive If you need P350,000 for a down payment on a house in 3 years, how much money must you invest today at 8% interest, compounded quarterly, to achieve your goal? a
If you need P350,000 for a down payment on a house in 3 years, how much money must you invest today at 8% interest, compounded quarterly, to achieve your goal? a
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If you need P350,000 for a down payment on a house in 3 years, how much money must you invest today at 8% interest, compounded quarterly, to achieve your goal?
a. P277,841.28
b. P275,972.61
c. P128,694.27
d. P44,388.46
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Answer : b. P275,972.61
Step-by-step explanation
| Future Value | 350,000.00 | |
| Interest | 8% | |
| Compounding | Quarterly | |
| Period | 3.00 | |
| Formula : | Present Value = Future Value / ( 1 + 8% / 4 ) Period x 4 | |
| Solution : | ||
| Future Value | 350,000.00 | |
| Divide : Interest Factor (1+8%/4)3 x4 | 1.26824 | |
| Present Value | 275,972.61 | |
