University of MelbourneFINANCE MISCAnswer 3 and 4. ALL ANSWWRS CORRECT

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Question no. 3 NPV of all cash outflow of the buy decision from month 0 to month 120? From previous answer, it is known that: Example cash flow of buying decision for the first 120 months is tabula... ted as follow: So, based on the cash flow above, we can simply calculate the NPV from the first 120 month by using formula of NPV annuity: ???? ?????????????? = ?? ?? × �1 − (1 + ??1????)??� ???? ?????????????? = −?????? 5,509.2 0.25% × �1 − (1 + 0.25% 1 )120� + (−?????? 368,000) = −?????? ??????, ??????. ?? By applying those, formula, so the PV of the first 120 months is equal to – SGD 938,547.4. Note, that negative value means, the total amount of money that Mr. Wong needs to spend for the first 10 years. Maintenance fee SGD 250 per month Property tax SGD 100 per month Gen. maintenance SGD 100 per month Total other fee SGD 450 per month 20% DP SGD 300,000 single payment 3% Stamp duty SGD 45,000 single payment 1% agent fee SGD 15,000 single payment Legal transfer SGD 4,000 single payment Closing fee SGD 4,000 single payment Total initial payment SGD 368,000 single pay [Show More]

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