The correct answer is A. P 3,260.34.
The firm borrows P2,000 for 6 years at 8%. The interest for the first 6 years is P2,000 x 8% x 6 = P960. The amount due at the end of 6 years is P2,000 + P960 = P2,960.
The firm renews the loan for the amount due plus P2,000 more for 2 years at 8%. The total amount borrowed is P2,960 + P2,000 = P4,960. The interest for the next 2 years is P4,960 x 8% x 2 = P691.20. The lump sum due is P4,960 + P691.20 = P5,651.20.
Here is a breakdown of the calculation:
Loan amount = P2,000
Interest rate = 8%
Loan term = 6 years
Interest for the first 6 years = P2,000 x 8% x 6 = P960
Amount due at the end of 6 years = P2,000 + P960 = P2,960
New loan amount = P2,960 + P2,000 = P4,960
Interest rate = 8%
Loan term = 2 years
Interest for the next 2 years = P4,960 x 8% x 2 = P691.20
Lump sum due = P4,960 + P691.20 = P5,651.20