Monthly payments of the future value of Php 20.00 for 2yrs with an interest rate of 10% compounded monthly
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Monthly payments of the future value of Php 20.00 for 2yrs with an interest rate of 10% compounded monthly
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Step-by-step explanation:
To calculate the monthly payments of the future value of Php 20.00 for 2 years with an interest rate of 10% compounded monthly, you can use the formula for the future value of an annuity:
FV = PMT * (((1 + r)^n - 1) / r)
Where: FV = Future value PMT = Payment amount (Php 20.00 in this case) r = Interest rate (10% in this case, expressed as a decimal) n = Number of payments (24 in this case, since it's for 2 years with monthly compounding)
Plugging in the values: FV = 20 * (((1 + 0.10)^24 - 1) / 0.10)
FV = 20 * ((1.10^24 - 1) / 0.10)
FV = 20 * (3.91420)
FV = Php 78,284.00
So, the future value of Php 20.00 compounded monthly at 10% interest for 2 years is Php 78,284.00. To find the monthly payments, you will divide the future value by the number of payments, in this case 24.
PMT = FV / n
PMT = 78,284 / 24
PMT = Php 3,262.75
So, the monthly payment for 2 years with an interest rate of 10% compounded monthly is Php 3,262.75.