1.

A young electrical engineer borrowed money P10,000 at 12% interest and paid P2,000 per annum
for the last 4 years. What does he have to pay at the end of the fifth year in order to pay off his loan?
(REE 2019)

Solution 1:

F = P (1+i) n

where:

F = Future amount

P = Present amount

i = rate/percent

n = number of years

ORDINARY ANNUITY

– series of equal payment at equal interval of time.

P = ( A/i ) [ ( (1+i) n - 1) / (1+i) n ]

where:

A = Annuity – a uniform series of payment occurring at equal interval of time.

P = Present amount

I = Rate/Percent

n = number of years

substitute the given:

P = (2,000/0.12) [ ( (1+0.12) 4 – 1 ) / (1+0.12) 4 ]

P = 6,074.698693  store A

remaining to be paid:

P = 10,000 – (store A) = 3,925.301307  store B

Will be paid by the young electrical engineer in 5 years with interest:

F = P (1+i) n = (store B) (1+0.12) 5 = P 6,917. 7221 ~ P 6,922.93

Solution 2: (CASH FLOW)

A young electrical engineer borrowed money P10,000 at 12% interest and paid P2,000 per
annum for the last 4 years. What does he have to pay at the end of the fifth year in order to pay off
his loan?

FOCAL POINT

NOTE : Future papuntang Present :

P = F (1+i) –n

10,000 = 2k (1+0.12) -1 + 2k (1+0.12) -2 + 2k (1+0.12) -3 + 2k (1+0.12) -4 + x (1+0.12) -5

X = P 6,917.7221 ~ P 6,922.93
2. What is most nearly the present worth of a $100 annuity over 10 years period if the interest is 8%.

SOLUTION:

P = F (1+i) –n

P = 100 (1+0.08) –1 + 100 (1+0.08) –2 + 100 (1+0.08) –3 + 100 (1+0.08) –4 + 100 (1+0.08) –5 + 100
(1+0.08) –6 + 100 (1+0.08) –7 + 100 (1+0.08) –8 + 100 (1+0.08) –9 + 100 (1+0.08) –10 = 671

3. An interest rate of 10% compounded semiannually is equivalent to how many per cent
compounded quarterly? (REE 2019)

SOLUTION:

iesemiannually = iequarterly

inR = 0.09878 x 100% = 9.878%

4. Determine the exact simple interest on P5,000 for the period from January 15 to June 20,1993, if
the rate of simple interest is 14%.

SOLUTION:

I = Pin

January 15, 1993 - 16 days May - 31 days

February - 28 days June 20,1993 - 20 days

March - 31 days

April - 30 days

n = 16 days + 28 days + 31 days + 30 days + 31 days + 20 days = 156 days

Exact simple  n = 365 days

Interest:

I = P5,000(0.14)(156 days x 1year/365days) = P299.1780 ~ P299.18

5. What is the percent composition by mass of oxygen (O) element in sulfuric acid (H2SO4)?

H = 1.008 amu, S = 32.07 amu, and O = 16.00 amu.

SOLUTION:

%O2 = (4(16.00)) / (2(1.008) + 32.07 + 4(16.00) x 100% = 65.25%