Solution: How much must Alexander Michael pay at the end of two years?

(Last Updated On: December 8, 2017)

How much must Alexander Michael pay at the end of two years?

Problem Statement: ME Board April 1993

Alexander Michael owes P25,000.00 due in 1 year and P75,000 due in 4 years. He agrees to pay P50,000 today and the balance in 2 years. How much must he pay at the end of two years if money is worth 5% compounded semi-annually?

  • A. P38,025.28
  • B. P35,021.25
  • C. P30,500.55
  • D. P39,021.28

Problem Answer:

Alexander Michael must pay P39,021.28 at the end of two years.

Solution:

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Solution: How much must Alexander Michael pay at the end of two years?
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