Question

A person bought a house paying rs.20000 cash down and rs. 4000 at the end of each year for 25 years at 5% p.a compound interest. the cash down price is??
A .75000 B. 76000 C76392

Answer 1

Thank you for asking this question. Here is your answer:

PV = 4000 x sum of 1/(1+r)^n

= 4000 x sum of 1/(1.05)^25

= 56,375.77

Now we will calculate the total price here:

down price + pv

= 20,000 + 56,375

= 76,375

76,375 is the final answer for this question.

If there is any confusion please leave a comment below.

Answer 2

Step-by-step explanation:

P.V= 4000× (1- (1.05)^-25/.05

4000× (1 -(3.3863549)/.05

4000× (1 - 0.2953027)/.05

4000× ( 0.70469722)/.05

4000×14.0939445658

56375.77

Paid = 20000

cash down price is 20000+ 56375.77

= 76375.77