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Compute for the fv if anton pays an ordinary annuity

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Reference no: EM133135781

Question - Please use the correct formulas when computing and please explain in layman's term.

Loan Amortization 1 - Domino and Caramel took out a bank loan to finance their house construction.

They were approved of a Php4,000,000 loan, payable monthly for the next 5 years.

Interest rate is 17.274%. Monthly payment is Php100,000

Construct an amortization table and please explain the following:

1. How much was the total interest paid by the end of 5 years?

2. How much is the interest if they opted to pay the Php4M one-time after 5 years?

3. How much of the 15th monthly payment was applicable to the principal?

4. What is the loan balance after 20 monthly payments?

5. Explain why the monthly interest is decreasing as time goes by.

The amort table can be made manually as a table or in MS Excel.

Loan Amortization 2 - Jon and Danny started a business

They took out a Php2 million loan payable quarterly for 7 years.

Interest rate is 15.9925%. Quarterly payment is Php120,000.

1. How much was the total interest paid by the end of 4 years?

2. How much was the total interest paid by the end of 7 years?

3. How much of the 21st monthly payment was applicable to the principal?

4. What is the loan balance after 15 monthly payments?

5. How much is the interest if they opted to pay the Php2M one-time after 7 years?

Present Value Annuities - Antonio plans on saving Php15,000 per year so he can buy the newest iPhone model in three years time. Invested in an instrument that earns 10% a year, how much is the present value of Antonio's savings today?

1. Compute for the PV if Antonio pays an ordinary annuity.

2. Compute for the PV if Antonio pays an annuity due.

Ben wants to save Php8,000 per month to finance a car he wants to buy after five years. If the opportunity cost is 12%, how much is the present value of Ben's target savings today?

3. Compute for the PV if Ben pays an ordinary annuity.

4. Compute for the PV if Ben pays an annuity due.

Future Value Annuities - Anton plans on saving Php15,000 per year so he can buy the newest iPhone model in three years time. Invested in an instrument that earns 10% a year, how much is the future value of Anton's savings in three years?

1. Compute for the FV if Anton pays an ordinary annuity.

2. Compute for the FV if Anton pays an annuity due.

Benjie wants to save Php8,000 per month to finance a car he wants to buy after five years. If the opportunity cost is 12%, how much is the future value of Benjie's target savings in five years?

3. Compute for the FV if Benjie pays an ordinary annuity.

4. Compute for the FV if Benjie pays an annuity due.

Reference no: EM133135781

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