EQUIVALENT YIELD (ANNUALIZED INVESTMENT YIELD DISCOUNTED RATE/ADVANCE INTEREST RATE

𝑃𝐹 − 𝑃𝑂 365 1) ir / 1 + ir * 100 = .17 / (1.17) x 100 = 14.53%, or

×
𝑃𝑂 𝑛 2) (1 / 1 + r) - 1 * 100 = ( 1 /1.17 - 1 * 100) = 14.53%
𝑖
Dn = 𝑑𝑛 = 𝑛
(1+𝑖𝑟)

EFFECTIVE ANNUAL RETURN (EAR)

365
365 𝑛−1
(1 + )
𝑛

PRESENT VALUE OF THE STREAM

3) Loan amount / 1+ ir
40, 𝑂𝑂𝑂 40000 40000
+ +
1.08 1 ⋅ 1664 1.259712

NET PRESENT VALUE OF STREAM FULL OR THE TOTAL PAYMENT (PRINCIPAL + ACCRUED INTEREST FOR
3 MONTHS) + PENALTY CHARGES FOR 3 MONTHS.
𝑃𝑉 − 𝐶𝑜𝑠𝑡

DECISION MAKER, CONSIDER PROJECT

Surplus of 3,083.86
Dapat mas mataas ang NPV after deducting project