Question

Find the present value of Php. 54000 due in 3 years if the money is worth 12% interest compounded semi-annually.

Answer 1

Given : Php. 54000 due in 3 years

money is worth 12% interest compounded semi-annually.

To Find : present value

Solution:

present value = P

Rate of interest = 12 % per annum = 6 % semi-annually.

Time n = 3 Years = 6  semi year

54000 = P (1  + R/100)ⁿ

=> 54000 = P (1  + 6/100)⁶

=> 54000 = P (1.06)⁶

=> P = 54000 /  (1.06)⁶

=> P = 38,067.87

present value  is 38,067.87 PHP

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