Engineering Board Exam Reviewer · Rate of Return Analysis · medium
An investment of P100,000 returns P30,000 at the end of each year for 5 years. Find the rate of return.
- 10%
- 15.24%
- 20%
- 12%
Answer
B. 15.24%
Solution
Set 100,000=30,000(P/A,i,5) (P/A,i,5)=3.3333. At 15%, (P/A)=3.3522; at 16%, 3.2743. Interpolating gives i 15.24%.
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