Final answer:
The present value of the monthly payment would be approximately P2,237,332.04.
Step-by-step explanation:
To calculate the future value of Mrs. Remoto's savings after 9 years, we can use the formula for the future value of an ordinary annuity:
FV = P * [(1 + r)^n - 1] / r
Where FV is the future value, P is the monthly payment, r is the interest rate per period (in this case, 8.6% divided by 12), and n is the number of periods (in this case, 9 years multiplied by 12).
Plugging in the values, we get:
FV = 8300 * [(1 + 8.6%/12)^(9*12) - 1] / (8.6%/12)
FV = 8300 * [1.00716667^(108) - 1] / 0.00716667
FV ≈ 1,424,899.79
Therefore, the amount or future value of her savings after 9 years would be approximately P1,424,899.79.
To find the present value of the monthly payment of P40,000 for 5 years with an interest rate of 7% compounded annually, we can use the formula for the present value of an ordinary annuity:
PV = A * [(1 - (1 + r)^-n)] / r
Where PV is the present value, A is the monthly payment, r is the interest rate per period (in this case, 7% divided by 12), and n is the number of periods (in this case, 5 years multiplied by 12).
Plugging in the values, we get:
PV = 40000 * [(1 - (1 + 7%/12)^-(5*12))] / (7%/12)
PV = 40000 * [1 - 0.5683785889] / 0.0058333333
PV ≈ 2,237,332.04
Therefore, the present value of the monthly payment would be approximately P2,237,332.04.