Name:_______________________________ Course & Year: _____________

Assignment no. 2
SHOW YOUR SOLUTION
Instruction: Answer the questions correctly and it must be eligible. Upon submission kindly scan your
answers or compile the picture of your answer and convert it to pdf format. Please avoid cheating or
reduplication of your answers from your classmate or else your score will be zero.

1. What are the present worth and the accumulated amount of a 10-year annuity paying P10,000 at the end of
each year, with interest at 15% compounded annually?
2. Sixty monthly deposits are made into an account paying 6% nominal interest compounded monthly. If the subject
of these is deposits is to accumulate P100,000 by the end of the fifth year, what is the amount of each deposits?
3. How much should be deposited each year to 12 years if you wish to withdraw P309 each per years for five years
beginning at the end of the 15𝑡ℎ year? Let the interest rate be 8%per year.
4. An individual is borrowing P100, 000 at 8% interest compounded annually. The loan is to be repaid in equal
payments over 30 years. However, just after eight payment is made, lender allows the borrower to triple the
payment. The borrower agrees to this increase payment. If the lender is still charging 10% per year,
compounded annually, on the unpaid balance of the loan, what is the balance still owed just after the 12𝑡ℎ
payment is made?
5. A woman arranges to repay a P 102,000 bank loan into equal payment at a 10% effective annual interest rate.
Immediately after her third payment, she borrows another P5, 000 also at 10% per year. When she borrows the
P5, 000 she talks the banker into letting her to repay the remaining debt of the first loan and the entire amount of
second loan in 12 equal payments. The first of these 12 payments would be made one year after she receives
the P5, 000. Compute the amount of each of the 12 payments?

Summary of Answer

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