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Value of the amount of money

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1. MRs. Happy Lucky won the "Game ka na ba" contest. As her prize, she is given the following choices:

A. To receive an instant cash of P250,000

B. To receive a monthly pension of P12,000 for two and a half years

C. To receive a quarterly pension of P35,000 for 3 years

D. To receive a yearly pension as follows: P100,000 for the first year; P50,000 each year for the next 5 years; P75,000 each year for the last 3 years.

Which choices you recommend to Mrs. Happy Lucky? Discount rate is 12% per annum.

2. Fasteepa wants to save money for Jacks who will graduate 3 years from now. Fasteepa intends to deposit P99,000 for 3 years. The bank interest rate is 12% p.a. compounded quarterly. How much is the amount of money Jacks will have when he graduates?

3. Trisha is being promised by Pasta to receive P50,000 every beginning of the month for two years. The interest rate is 12% per annum. How much is the value of the amount of money promised by Pasta, today?

Reference no: EM133114431

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