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A commercial bldg. can be acquired at a down payment of P500,000 and a yearly payment...

A commercial bldg. can be acquired at a down payment of P500,000 and a yearly payment of P100,000 at the end of each year for a period of 10 years, starting at the end of 5 years from the date of purchase. If money is worth 12% compounded yearly. What is the cash price of the commercial bldg.? CASH FLOW DIAGRAM is needed.

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Answer. 859080.42
To calculate the present value of annuity 100000, we have calculated its present value at time 4 and then discounted the PV at 4 to 0. This is a correc answe but an approximate one.

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