The institute of Electronics and Communications Engineers of the Philippines (IECEP) is planning to put up its own building. Two proposals being considered are:<br>A. The construction of the building now to cost P 400,000<br>B. The construction of a smaller building now to cost P300,000 and at the end of 5 years, an extension to be added to cost P 200,000.<br>By how much is proposal B more economical than proposal A if interest rate is 20% and depreciation to be neglected?<br>

Correct Answer: P 19,624.49