Loan and Interest

INTRODUCTION PROBLEM PROCESS

With the ongoing Representations:
health crisis, Jan’s Principal / Loan (P1) – ₱50,000.00
family decided to start Rate (R1) – 5 %
Loan and Interest their own business Time (T1) – 5 years
During These because most of their Principal / Loan (P2) – ₱80,000.00
Trying Times family members lost Rate (R2) – 3%
jobs during the Time (T2) – 5 years
lockdown. The Mariño Total Maturity Value (F) - unknown
family borrowed fifty
The Coronavirus thousand pesos Equation:
Disease (COVID- (₱50,000) from the F = {P1 [1 +(R1 T1)]} + {P2 [1 +(R2
19), an infectious Oriental Bank of the T2)]}
illness from Philippines (OBP).
Wuhan, China, They also borrowed Explanation:
affected eighty thousand pesos The problem requires the total amount
everyone’s daily (₱80,000) from the of maturity value otherwise known as
routine; shift to Century Bank of the the final amount, which the lenders
remote learning; Metro (CBM). The shall receive from the borrower on the
limited access to Mariño family were maturity date. In light with this, the
healthcare; limited given a five percent equation to solve the problem includes
social interactions; (5%) interest rate by the total maturity value that is equal to
health, safety, and the OBP while the the first principal amount multiplied to
security risks CBM gave them a the sum of one and the product of the
(National Center three percent (3%) first rate and the first time, which are
for Immunization interest rate. How all added to the second principal
and Respiratory much will the family amount multiplied to the sum of one
Diseases (NCIRD), need to save to pay and the product of the second rate
Division both of the banks after and the second time provided.
of Viral Diseases., five (5) years?
2020).
PROCESS CONCLUSION REFERENCES:
Solution: In order to answer the National Center for Immunization and
F = {P1 [1 +(R1 question, I based the Respiratory Diseases (NCIRD),
T1)]} + {P2 [1 +(R2 process of solving for Division of Viral Diseases. (2020,
T2)]} the interest through the September 17).
principal loan, interest Keep Children Healthy during the
F = {₱50,000.00 [ 1 rate, and time from our COVID-19 Pandemic Ways to
+ (0.05)(5)]} + modules. The lessons Promote Children’s Wellbeing.
{₱80,000.00 [ 1 + were very helpful Centers for Disease Control and
(0.03)(5)]} because I realized that Prevention. Retrieved November 6,
it is significant for me 2020, from
F = [₱50,000.00 to grasp each concept https://www.cdc.gov/coronavirus/2019-
(1.25)] + for their real-life ncov/daily-life-coping/children.html
[₱80,000.00 (1.15)] applications.
Throughout our difficult
F = ₱62,500.00 + health and financial
₱92,000.00 situations, loans and
interests are common
F = ₱154,500.00 and practical for
members of the
Explanation: community to
To solve the understand.
equation, the Comprehending the
representations idea of lending money,
from the first creditors, and maturity
principal or loan, dates is useful for other
first rate, and first situations aside from
time to the second bank loans such as
principal or loan, investments, mortgage,
second rate, and and interest
second time, amortization.
are substituted to
the given equation.
After which, the
steps of the
PEMDAS rule in
solving for the final
amount of
₱154,500.00 are
followed carefully.

Answer:
Maturity Value – ₱
₱154,500.00

Explanation:

The total amount

that Jan Mariño’s
family will have to
pay the banks after
five years is ₱
₱154,500.00.
Simple Interest – Oriental Bank of the Philippines (OBP)

Amount after T years

Time Principal Solution Answer
(Maturity Value)
1 (50,000)(.05) = 2,500 2,500 50,000 + 2,500 = 52,500

2 (50,000)(.05) = 2,500 2,500 50,000 + 2,500 = 52,500

3 ₱50,000 (50,000)(.05) = 2,500 2,500 50,000 + 2,500 = 52,500

4 (50,000)(.05) = 2,500 2,500 50,000 + 2,500 = 52,500

5 (50,000)(.05) = 2,500 2,500 50,000 + 2,500 = 52,500

Total ₱50,000 ₱12,500 ₱62,500.00

Compound Semi Annual Interest – Century Bank of the Metro (CBM)

Amount after T years

Time Principal Solution Answer
(Maturity Value)
(80,000)(.03)(2) =
1 ₱80,000 4,800 80,000 + 4,800 = ₱84,800
4,800
(84,800)(.03)(2) =
2 ₱84,800 5,088 84,800 + 5,088 = ₱89,888
5,088
(89,888)(.03)(2) = 89,888 + 5,393.28 =
3 ₱89,888 5,393.28
5,393.28 ₱95,281.28
(95,281.28)(.03)(2) 95,281.28 + 5,716.88 =
4 ₱95,281.28 5,716.88
= 5,716.88 ₱100,998.16
(100,998.16)(.03) 100,998.14 + 6,059.89 =
5 ₱100,998.16 6,059.89
(2) = 6,059.89 ₱107,058.03
Tota
P=₱80,000 I ₱27,058.03 ₱107,058.03
l
Compound Semi Annual Interest – Century Bank of the Metro (CBM)

Amount after T years

Time Principal Solution Answer
(Maturity Value)
(80,000)(.03) =
1 ₱80,000 2,400 80,000 + 2,400 = ₱82,400
2,400
(82,400)(.03) =
2 ₱82,400 2,472 82,400 + 2,472 = ₱84,872
2,472
(84,872)(.03) = 84,872 + 2,546.16 =
3 ₱84,872 2,546.16
2,546.16 ₱87,418.16
(87,418.16)(.03) = 87,418.16 + 2,622.55 =
4 ₱87,418.16 2,622.55
2,622.55 ₱90,040.71
(90,040.71)(.03) = 90,040.71 + 2,701.22 =
5 ₱90,040.71 2,701.22
2,701.22 ₱92,741.93
Tota
P=₱80,000 I ₱12,741.93 ₱92,741.93
l

Compound Semi Annual Interest – Century Bank of the Metro (CBM)

Amount after T years

Time Principal Solution Answer
(Maturity Value)
1 ₱80,000 (80,000)(.03)() = 80,000 + = ₱

2 ₱81,200 ()(.03)( 0.5) = +=₱

3 ₱ ()(.03) = +=₱

4 ₱ ()(.03) = +=₱

5 ₱ ()(.03) = +=₱
Tota
P=₱80,000 I ₱ ₱
l

₱107,058.03 + ₱62,500.00 = ₱169,558.03