Answer to Question #319189 in Electrical Engineering for Jhay Jeff

Question

3.) The following terms of payment for an annuity are as follows:

Periodic payment = P20,000

Payment interval = 1 month

Interest rate = 18% compounded monthly

Terms = 15 years

1. Find the present worth paid of all the payments if it is paid at the end of each month.

2. Find the difference between the sums of an annuity due and an ordinary annuity on these payments.

3. Find the difference between the present values of an annuity due and an ordinary annuity based on these payments.

Ans. 1. P1,214,911.246 2. P271,687.35 3. P18,628.67