PROBLEMS

1. What is the annual rate of interest ifP265 is earned in four months

on an investment of P 15,000?
Ans. 5.3% •

2. A loan of P2.000 is made for a period of 13 months, from January

Ito January 31 the following year, at a simple interest rate of 20%. What
future amount is due at the end of the loan period?
Ans. P2.433.33

3. If you borrow money from your friend with simple interest of 12

%, find the present worth of P20.000, which is due at the end of nine
months.
Ans. P 18.348.62

4 Determine the exact simple interest on P&.000 tor rhe period from
Jan. 15 to Nov. 28. 1992. if the rate of interest is 22%. Ans. P955.74

5. A man wishes his son tn receive P200.000 ten years from now.
What amount should he invest if it will earn interest of 10% compounded
annually during the first 5 years and 12% compounded quarterly during
the next 5 years?
Ans* P68.758.67

6. By the conditions of a will, the sum of P25.000 is left to a girl to

beheld in trust by her guardian until it amounts to P45.000. When will the
girl receive the money if the fund is invested at 8% compounded
quarterly?
Ans. 7.42 years

7. At a certain interest rate compounded semiannually, P5,000 will

amount to P20.000 aftsr 10 years. What is the amount at the end of 15
years?
Ans. P40.029.72

•8. Jones Corporation borrowed P9,000 from Brown Corporauon on

Jan. 1, 1978 and P 12.000 on Jan. 1, 1980. Jones Corporation made a
partial payment of P7.000 on Jan. 1. 1981. It was agreed that the
balance of the loan would be amortized by rwo payments, one of Jan. 1.
1982 and the other on Jan. 1. 1983. rhe second being