CATHOLIC SCHOOLS IN IFUGAO

GENERAL MATHEMATICS
FIRST SEMESTER – FINALS A. Y. 2023-2024

WEEK 1: SIMPLE AND COMPOUND INTEREST

LESSON 1.1: SIMPLE INTEREST
Simple Interest – the original amount invested or borrowed serves as the basis of the computation of interest no
matter how long the period of investment or borrowing is.
Compound Interest- the original amount invested or borrowed only serves as the basis in the first round of interest
computation.
Let’s have this example to make this more concrete.
Suppose ₱10 000 is invested at 10 % for 3 years.
At simple interest:
Interest at the end of 1 year =(10 000 x 0.10) = 1 000
Accumulated amount at the end of year 1 = 10 000 + 1 000 = 11 000
Interest at the end of year 2 = (10 000 x 0.10) = 1 000
Accumulated amount at the end of year 2 = 11 000 + 1 000 = 12 000
Interest at the end of year 3 = (10 000 x 0.10) = 1 000
Accumulated amount at the end of year 2 = 12 000 + 1 000 = 13 000
At compound interest:
Interest at the end of 1 year =(10 000 x 0.10) = 1 000
Accumulated amount at the end of year 1 = 10 000 + 1 000 = 11 000
Interest at the end of year 2 = (11 000 x 0.10) = 1 100
Accumulated amount at the end of year 2 = 11 000 + 1 100 = 12 100
Interest at the end of year 3 = (12 100 x 0.10) = 1 210
Accumulated amount at the end of year 2 = 12 100 + 1 210 = 13 310
Thus, at simple interest ₱10 000 earned an interest of ₱3 000 while at compound interest it earned ₱3 310 worth of
interest. When compared the compound interest computed is bigger than simple interest and this is true in general.

In this unit, we will use the following notations.

P = principal; amount borrowed; amount invested; t = time; period of investment or borrowing
amount loaned; present value I = amount of interest
r = annual rate of simple interest F = accumulated amount; future value; maturity value
j = annual rate used for compound interest; nominal rate

Lesson 1: Simple Interest Computation

I I I
Formulas: I = Prt P= r= t=
rt Pt Pr
NOTE: * Rate r is expressed in percent thus do not forget to convert it to decimals when used in the computations.
*The time t is usually expressed into years. In cases that time is expressed in moths and days do not forget to
convert to its equivalent number of years using the following formulas:
no . of months
Converting months to year t=
12
no . of days no . of days
Converting days to year t= ∨ ; depending on the requirement in the given problem
360 365
Examples: 1.) Issa deposited ₱10 000 in a bank that offers a simple interest of 2.5 %. If she placed the money for 5 years,
how much interest will she earn at the end of 5 years?
Given: P = ₱10 000; r = 2.5 % or 0.025 ; and t = 5 years
Unknown: I = ?
Solution: I = Prt ⇒( ₱10 000)(0.025)(5)
= ₱1 250 thus, Issa will earned ₱1 250 worth of interest after 5 years.
2.Andrew borrowed money from Magnificent Lending Services at 2.75 % simple interest for 120 days to add to his funds
for house repair. If he was charged ₱3 300 for interest, how much did Andrew borrow?
120 1
Given: I = ₱10 000; r = 2.75 % or 0.0275 ; and t = 120 days or ∨ year
360 3
Unknown: P = ?

1|GENERAL MATHEMATICS
 I 3 300
P= ⇒
Solution: rt 1 = ₱360 000 therefore, Andrew borrowed ₱360 000.
0.0275( )
3
3.At what rate did Simon invest his money amounting to ₱175 000 if he received ₱2 843.75 worth of interest after 6
months?
6
Given: P = ₱175 000; I = ₱ 2 843.75 ; and t = 6 mos. or ∨0.5 year
12
Unknown: r = ?
I I 2 843.75
Solution: r = ⇒
Pt (175 000)(0.5)
= 0.0325
= 3.25 % thus, Simon invested his money at the rate of 3.25 % per year.
4.How long will it take for an investment of ₱250 000 to double itself if it is invested at the rate of 8%?
Given: P = ₱250 000; I = ₱ 250 000 ; and r = 8% or 0.08
Unknown: t = ?
I 250 000
Solution: t= ⇒
Pr (250 000)(0.08)
= 12.5 years or 12 years and 6 months
Therefore, it will require 12 years and 6 months to double the investment at the given rate of interest.

ORDINARY AND EXACT INTEREST

If the time of investment is quoted in days, we have two ways to convert days to years. That is, either dividing by
360 or 365. Dividing by360 means we are approximating every month to contain 30 days while dividing by 365 only
makes the use of the fact that there are exact 365 days in a year unless it is a leap year with 366. This process leads to
two types of simple interest called the ordinary interest (denoted by Io )and exact interest (denoted by Ie).
time∈days time∈days
Formulas: I o=P ∙ r ∙ I E =P∙ r ∙
360 365
Note: In some cases, the time component may be expressed in between dates. This situation leads to two possible
considerations; the actual number of days and the approximate number of days.
ACTUAL NUMBER OF DAYS – exact number of days
Months with 30 days: April, June, September, and November
Months with 31 days: January, March, May, July, August, October, and December
February has 28 days ordinarily but has 29 days in a leap year
APPROXIMATE NUMBER OF DAYS – approximately 30 days in a month
CASE 1: Ordinary Interest Actual Number of Days
t
⇒ I o (actual)=P ∙ r ∙ ; where t is the actual number of days
360
CASE 2: Ordinary Interest Approximate Number of Days
t
⇒ I o (approximate)=P ∙ r ∙ ; wheret is the approximate number of days
360
C ASE 3: Exact Interest Actual Number of Days
t
⇒ I E (actual )=P ∙r ∙ ; where t is the actual number of days
365
CASE 4: Exact Interest Approximate Number of Days
t
⇒ I E (approximate )=P ∙r ∙ ; where t is the approximate number of days
365
Note: CASE 1 is known as the BANKER’S RULE and yields the highest interest from among the four cases possible.
Example:
Joey invested ₱900 000 at the rate of 5.25 % per annum. Compute for the following when the money was
invested between March 23, 2015 to July 7, 2015. Find: Ordinary Interest Actual Number of Days, Ordinary Interest
Approximate Number of Days, Exact Interest Actual Number of Days and Exact Interest Approximate Number of Days.
Given: P = ₱900 000; and r = 5.25% or 0.0525
Actual days = March – 8 Approximate days = March(30-23) - 7
April - 30 April - 30
May - 31 May - 30
June - 30 June - 30
July - 7 July - 7
106 104

2|GENERAL MATHEMATICS
 Solution: a. I o(actual )=( 900 000 )( 0.0525 ) ( 106
360 )
=₱ 13 912.50

=( 900 000 )( 0.0525 ) (

360 )
104
I o(approximate ) =₱ 13 650.00

=( 900 000 ) ( 0.0525 ) (

365 )
106
I E (actual) =₱ 13 721.92

=( 900 000 ) ( 0.0525 ) (

365 )
104
I E (actual) =₱ 13 463.01

MATURITY VALUE OF A SIMPLE INTEREST PRESENT VALUE OF A SIMPLE INTEREST

-the sum of the money at the end of the period Principal amount or amount invested or amount
- the accumulated value or future value borrowed
- denoted as F F
Formulas: P = F – I P=
Formulas: F=P+I F = P(1 + rt) 1+ rt
F−P F−P
Formula to use if F is given: r = t=
Pt Pr
Examples:
1. Arthur invested ₱100 000 at the rate of 2 % a year. How much will the maturity value be if he invested for 2
years and 6 months? How much interest was earned?
Given: P = ₱100 000; r = 2 % or 0.02 ; and t = 2.5 years
Unknown: F = ? and I = ?
Solution: F=P ( 1+ rt ) ⇒ 100 000 [1+ 0.02 ( 2.5 )] Thus, the maturity value after 2 years and 6 months is
= ₱105 000 ₱105 000 and the interest earned is ₱5 000.
I = F – P ⇒ ₱105 000 - ₱100 000
= ₱5 000

LESSON 1.2: COMPOUND INTEREST

Variables used:
P = principal; amount borrowed; amount invested; amount
loaned; present value
m = numbers of times interest is compounded in a year
j = annual rate used for compound interest; nominal rate
t = time; period of investment or borrowing
F = accumulated amount; future value; maturity value
n =(mt) total number of times interest were computed for
the whole duration of investment or borrowing
i = interest rate per compounding period

log ( FP )
( ) [( ) ]
mt 1
j F j F
Formulas: F=P 1+ P= i= t= j=m mt
−1
( )
m j
mt
m mlog (1+i ) P
1+
m
Note: Calculation of interest can be annually, semiannually, quarterly, monthly and even daily. Hence, we can use the
following values of m: annually=1, semiannually=2, quarterly=4, monthly=12 and even daily=360 0r 365.
Examples:
1. Eden invested ₱250 000 at the rate of 4 % compounded quarterly. What is the accumulated value of the
investment after 48 months?
Given: P =₱250 000; j = 4 % or 0.04; m = 4 and t= 48 mos.∨4 years
Unknown: F = ?

( ) ( )
mt 4 ×4
j 0.04
Solution: F=P 1+ ⇒250 000 1+ = ₱293 144 .66
m 4
Thus, Eden’s investment will accumulate to ₱293 144 .66 after 48 months.
2. Ricky borrowed money from the bank at the rate of 5.25% compounded annually. If his loan accumulated to
₱180 500 after 3.5 years, how much did Ricky borrow?
Given: F =₱180 500; j =5.25 % or 0.0525; m = 1 and t= 3.5 years
Unknown: P = ?
F 180 500
P= ⇒ 1(3.5) ¿ 180 500
( ) ( )
mt
Solution: j 0.0525 ¿ ₱ 150 903.68 ; Thus, Ricky borrowed ₱150 903 .68
1+ 1+ ( 1+ 0.0525 )3.5
m 1

3|GENERAL MATHEMATICS
 3. A man borrows ₱50 000 and promises to pay the compound amount of ₱62 500 at the end of 5 years. What is the
interest rate compounded monthly?
Given: F =₱50 000; m = 12 and t= 5 years
Unknown: j = ?

[( ) ] [( ) ]
1 1
F 62 500
Solution: j=m mt
−1 ⇒12 12× 5
−1
P 50 000
= 0. 0447 or 4.47 %
Therefore, the nominal rate is 4 .47 % compounded monthly.
4. How long will it take ₱250 000 to gain an interest of ₱10 000 if money is worth 2 % compounded annually?
Given: P =₱250 000; I= 10 000; j= 2% or 0.02; m = 1 and
F =P +I ⇒ ₱ 250 000+ ₱ 10 000 = ₱260 000
j 0.02
i= ⇒ o r 0.02
m 1
Unknown: t = ?

Solution:
t=
log ( FP ) ⇒
log ( 260
250 000 )
000

mlog ( 1+i ) mlog ( 1+0.02 )

=
log ( 260
250 000 ) = 1.98 years
000

mlog ( 1 .02 )
Thus, it will take 1.98 years or almost 2 years for ₱250 000 to accumulate ₱260 000.
WEEK 2: ANNUITIES
LESSON 2.1: SIMPLE ANNUITY
Definition of Terms:
ANNUITY– a series of payments usually of equal amount made regularly at equal(fixed) intervals or periods of time.
ANNUITIES
2 major types: According Simple Annuity General Annuity
to - a case where the frequency of a regular - a case when the frequency of the regular
payment payment is equal to the frequency of interest payment is different from the frequency of
interval conversion interest conversion
and
interest - an annuity where the payment interval is the - an annuity where the payment interval is not
period same as the interest period the same as the interest period
Example: A series of regular payments of ₱10 Example: A series of regular payments of ₱10
000 every month with an interest of 5% 000 every month with an interest of 5%
compounded monthly. compounded quarterly.
Classifications: According Annuity Certain– Contingent Annuity
to -has definite term of payment -has an indefinite term depending on the
duration occurrence of a contingent event like death.
-an annuity in which payments begin and end at – an annuity in which the payments extend over
definite times an indefinite (or indeterminate) length of time
Example: A premium payments. In this case a
Example: A series of payments made to amortize premium payment stops upon the death of the
a car insured.
According Ordinary Annuity (or Annuity Immediate) – a Annuity Due
to time of type of annuity in which the payments are made – a type of annuity in which the payments are
payment at the end of each payment interval made at beginning of each payment interval
Example: An annuity 15000 paid at the beginning
Example: an annuity of 1000 paid at the end of of each month
each month
Concentration of the lesson: Simple, Certain, and Ordinary Annuity.
NOTATIONS
R Regular payment; periodic payment i j
Interest rate per conversion i=
m
A Present value of an annuity m Frequency of regular payments in a year; frequency of interest conversion in a
year
S Future value of an annuity t Term or period of an annuity
j Nominal rate of interest n Total number of periodic payments; total number of interest conversions or
computations n=mt
PRESENT VALUE OF AN ANNUITY A - refers to the one time payment at present equivalent to the series of periodic
payments R. to solve for A, we use the formula:

4|GENERAL MATHEMATICS
FUTURE VALUE OF AN ANNUITY S - refers to the one time payment at the end of the term equivalent to the series of
periodic payments R. to solve for S, we use the formula:
[ ]
n
(1+i) −1
S=R
Example 1 i
Consider a series of regular payments of ₱10 000 at the end of each year for 5 years. Assume an interest rate of of 10%
per annum compounded annually. The present value of annuity of ₱10 000 is computed as follows in detail:

Present Value of the Annuity = ₱10 000 (1.10)-1 + ₱10 000 (1.10)-2 + ₱10 000 (1.10)-3+ ₱10 000 (1.10)-4+ ₱10 000 (1.10)-5
= ₱37 907.87

[ ]
−1 (5 )
0.1
1−(1+ )
[ ]
−n
1−(1+i) 1
Using the formula: A=R = 10 000 =₱37 907.87
i 0.1
1
Consider the same scenario given but this time, let us determine the future value of the series of payment ₱10 000 for 5
years at the end of each year
Future Value of the Annuity = ₱10 000 (1.10)4 + ₱10 000 (1.10)3 + ₱10 000 (1.10)2+ ₱10 000 (1.10)1+ ₱10 000
= ₱61 051

[ ]
1(5)
0.1
(1+ ) −1
[ ]
n
(1+i) −1 1
Using the formula: S=R = 10 000 =₱61 051
i 0.1
1
Example 2. If money is worth 4% compounded quarterly, find the present value of an annuity of ₱10 000 payable at the
end of every three months for 10 years.

[ ]
Given: R=₱10 000 Solution: −n
1−(1+i)
j=4%=0.04 A=R = ₱10 000
m= 4 i

[[ ]
t= 10 years 0.04
−4 (10 )
1−(1+ )
Example 3. If money is worth 5% compounded semi-annually, find the future value of an annuity of ₱12 000 payable at
4
the end of every six months for 5 years. =₱ 328 346.86

]
0.04
(1+i)
n
−1
Given: R=₱12 000 Solution:
S=R 4 = ₱12 000
j=5%=0.05 i
m= 2
t= 5 years

Lesson 2: SOLVING FOR THE REGULAR PAYMENTS

When you amortize a car or a house, you need to know how the required monthly amortization is arrived at.
Thus, it is equally important to learn how to compute for the regular payment or the periodic payment R. The
formula for R can be obtained from the formulas we have introduce to solve for A and S
CASE 1: SOLVING FOR R GIVEN A: CASE 1: SOLVING FOR R GIVEN S:
Formula: Formula:
A•i S •i
R= −n
R= n
1−(1+i) (1+i) −1
Example 1: Find the periodic payments at the end of every quarter for 10 years if the present value of an annuity is ₱500
000 and money is worth 4% per year compounded every three months.
Given: A=₱500 000
Solution:
j=4%=0.04
m= 4 R=
A • i
₱ 500 000
0.04
4 ( )
=₱ 15 227.80
−n =

( )
−4(10)
t= 10 years 1−(1+i) 0.04
Example 2: Caloy bought a brand new car worth ₱1 575 000. 1−He 1+made a down payment of 20% and the balance was
4
loaned from a bank at the rate of 6.5% per annum compounded monthly. How much should Caloy pay at the end of
every month for 5 years .
Since Caloy made a down payment of 20%, that means his balance which is equal to the amount that was
loaned is 80% of the price of the car and we take this to be the value of A. Thus A=(0.8)(₱1 575 000)= ₱1 260
000.
Given: A=₱1 260 000
j=6.5%=0.065
m= 12
Solution:
R=
A•i
₱ 1 260 000
0.065
12
=₱ 24 653.35
( )
−n =

(5 | G 12E N E) R A L
−12(5 )
t= 5 years 1−(1+i) 0.065
1− 1+
MATHEMATICS
Example 3: In order to generate a fund a fund of ₱250 000 after 5 years, how much semi-annual deposit should be made
at the end of every 6 months if money accumulates at the rate of 4% per annum compounded every six months?
Given: S=₱250 000 Solution:
j=4%=0.04
m= 2 R=
S •i
=
₱ 250 000
0.04
2 ( )
=₱ 22 831.63
n

(1+ ) −1
t= 5 years (1+i) −1 0.04 2(5)

WEEK 3: DEFERRED AND GENERAL ANNUITIES

LESSON 2.2: DEFERRED ANNUITIES
DEFERRED ANNUITY – when the periodic payments do not begin until the end of a specified time
*If an ordinary annuity is deferred for 3 months, this means that the first payment should be made at the
end of the fourth month.
Note: The present value of the deferred annuity is the sum of the present values of all the periodic payments.
Present Value of the Deferred Ordinary Annuity = Present Value of the Annuity for the Whole Period – Present Value
Of the Annuity for the Period of Deferral
Thus, if an annuity requires n periodic payments and if payments were deferred r times, then the Present Value of the
Annuity is:

[ ]
−r − ( n+r )
( 1+i ) −( 1+i )
A=R
i

Therefore, if the unknown is the periodic payment R for a deferred annuity, from the formula above,
A •i
R=
( 1+i ) −( 1+i )−(n +r )
−r

Example 1
If money is worth 6% compounded quarterly, find the present value of a sequence of 10 periodic payments of ₱10 000
each, the first of which is due at the end of 1 year and 3 months.
Note that period of deferral is one year.
Given: r =4, since quarterly payment is required
Solution:
n =10, since 10 periodic payment is required

[ ]
R = ₱10 000
( ) ( )
−4 −( 10+4 )
0.06 0.06
j = 6% or 0.06 1+ − 1+
m=4 A=R [
( 1+i )−r −( 1+i )−( n+r )
i ]
⇒ ₱10 000
4
0.06
4
=

4 She agreed to settle

Example 2: Jackie borrows 400 000 at an interest rate of 4% per year compounded semi-annually.
her loan by making 12 semi-annual payments at the end of each six months. If the first payment is made at the end of 2
years, compute for the periodic payment.
The period of deferral is a year and a half, since the first payment was made at the end of the second year.
Given: r =3 Solution:
n =12
A=₱400 000
j=4%=0.04 R=
A •i
400 000
0.04
2 ( ) =₱ 40 138.96
−r − ( n +r ) =

(1+ 2 ) −(1+ 2 )
− ( 12+3 )
m= 2 ( 1+i ) −( 1+i ) 0.04
−3
0.04

LESSON 2.3: GENERAL ANNUITIES

GENERAL ANNUITY – is an annuity whose interval of periodic payment is different from the frequency of interest
conversion.
In the case of general annuities,the periodic payment may be multiple of the interest conversion frequency or vice versa.

Formula for the Present Value of a General Annuity

[ ]
−n −n
R 1−( 1+i ) 1−( 1+i )
A= • periodic payment
A=R• interval
k
( 1+i ) −1 i Where k= k
interest conversion (interval
1+i ) −1
i
Note: Simple annuity results when the periodic payment is the same as the interest conversion interval. In this case, k=1
Formula for the Future Value of a General Annuity n
( 1+i ) −1
S=
R
k
( 1+i ) −1
•[( 1+i )n−1
i T]hus, the periodic payment R
S=R •
can be computed
k
( 1+i ) −1two ways, depending on whether it is A or S
i
that is given.

6|GENERAL MATHEMATICS
If A is given: ( 1+i )k −1 On the other hand, if S is given:
R=A • ( 1+i )k −1
−n R=S •
1−( 1+i ) n
( 1+i ) −1

Example 1: Find the present value of annuity ₱ 20 000 payable semi-annually for 5 years if money is worth6% per year
compounded quarterly.

( )
−20
Given: R = ₱ 20 000 Solution: 0.06
−n 1− 1+
j =6%=0.06 t=5 years 1−( 1+i ) 4
6 months A=R• =₱ 20 000 • =₱ 170 408.33
( 1+i )k −1
( )
2
m=4 k= =2 0.06
3 months 1+ −1
4
Example 2: Find the present value of an annuity of ₱ 5 000 payable quarterly for 10 years if money is worth 5% per year
compounded annually.
Given: R = ₱ 5 000 Solution: 1−( 1+i )−n 1−( 1+0.05 )−10
j =5%=0.05 t= 10 years A=R• k
=₱ 5 000 • 0.25
=₱ 157 300.92
( 1+i ) −1 ( 1+0.05 ) −1
3 months
m=1 k= =0.25
12months
Example 3: Find the future value of an annuity of ₱10 000 payable quarterly for 3 years if money is worth 12%
compounded monthly.
Given: R = ₱ 10 000 Solution: ( 1+i )n−1
S=R • = ₱ 10 000
j =12%=0.12 t= 3 years k
( 1+i ) −1
3 months
=3
( )
36
m=12 k= 0.12
1 month 1+ −1
Example 4: Find the quarterly payment of an annuity for 10 12 is ₱ 300 000 and money is worth
• years if its3present=₱value
142 163.22
7% compounded semi-annually.
Given: A = ₱ 300 000 Solution: ( 0.12 k
1+ ( 1+i−1
R=A • 12
)
) −1
−n = ₱ 300 000
j =7%=0.07 t= 10 years 1−( 1+i )
3 months
( )
0.5
m=2 k= =0.5 0.07
6 months 1+ −1
Example 5: Find the semi-annual payment of an annuity for 6 years
2 if its future value is ₱ 1 000 000. Assume that money
• =₱ 10 463.39
( )
−20
is worth 4% compounded quarterly. 0.07
1− 1+
Given: S = ₱ 1 000 000 2
6 months ( 1+i )k −1
j =4%=0.04 k= =2 Solution: R=S • n = ₱ 1 000 000
3 months ( 1+i ) −1
m=4 t= 6 years
( )
2
0.04
1+ −1
4
FORMATIVE ASSESSMENT 1: SIMPLE and COMPOUND
• 24 INTERESTS & ANNUITIES (40pts.)
=₱ 74 517.68

solutions.
(
A. SIMPLE & COMPOUND INTERESTS : Solve the following 0.04
)
1+ problems
4
−1using the appropriate formula. Show your

1. How much money will you have after 4 years and 3 months if you deposited P 10,000 in a bank that pays
0.5% simple interest?
2. Mila invested ₱10 000 at the rate of 4.15 % per annum. Compute for the following interest when the
money was invested between July 5, 2016 to November 27, 2016. (3pts. each)
a. Ordinary Interest Actual Number of Days
b. Ordinary Interest Approximate Number of Days
c. Exact Interest Actual Number of Days
d. Exact Interest Approximate Number of Days.
3. Clyde borrows P30,000 and promises to pay the principal and interest at 3% compounded semi-annually.
How much must he repay after a year? (5pts.)
B. ANNUITIES : Solve the following problems. Show your solution.
1. Paolo borrowed P 100 000. He agrees to pay the principal plus interest by paying an equal amount of
money each year for 3 years. What should be his annual payment if interest is 8% compounded annually?
(6pts.)
2. Vince availed of a loan from a bank that gave him an option to pay P10,000 monthly for 2 years. The first
payment is due after 6 months. How much is the present value of the loan if the interest rate is 5%
converted monthly? (6pts.)
3. Bruce borrowed an amount of money from Bailey. He agrees to pay the principal plus interest by paying
P8,850.25 each year for 2 years. How much money did he borrow if interest is 4% compounded quarterly?
(6pts.)

7|GENERAL MATHEMATICS
WEEK 4: BONDS AND STOCKS
Companies need additional funds for purposes like building factories, expansion of operations, or buying other
companies. Funds managers can use corporate profits for this purpose. However, they also have an option to borrow
money through bank loans or investor loans. Investor loans are also called bonds. Another option is to sell ownership of
the company via stocks.

COMPARISONS OF STOCKS AND BONDS

STOCKS
A form of equity financing or raising money by allowing
investors to be part owners of the company.
Stock prices vary every day. These prices are reported in
various media (newspaper, TV, internet, etc).
Investors can earn if the stock prices increase, but they
can lose money if the stock prices decrease or worse, if
the company goes bankrupt.
Higher risk but with possibility of higher returns
Can be appropriate if the investment is for the long term
(10 years or more). This can allow investors to wait for
stock prices to increase if ever they go low.
BONDS
A form of debt financing, or raising money by borrowing
from investors
Investors are guaranteed interest payments and a return
of their money at the maturity date
Investors still need to consider the borrower’s credit
rating. Bonds issued by the government pose less risk
than those by companies because the government has
guaranteed funding (taxes) from which it can pay its
loans.
Lower risk but lower yield
Can be appropriate for retirees (because of the
guaranteed fixed income) or for those who need the
money soon (because they cannot afford to take a chance
at the stock market)

LESSON 3.1: BONDS

In the Philippines, bonds are issued by the national government or by certain companies. The bonds
issued by the government are called treasury notes and bonds. On the other hand, the bonds issued by
companies are called corporate bonds. Corporate bonds come from various sectors like banks, real estate
companies, telecommunications companies, toll way operators and beer – based conglomerate. Some examples
of bonds issued by the government are treasury bonds, retail treasury bonds (RTB), and multi-currency retail
treasury bonds. Corporate bonds are issued by companies likes San Miguel Brewery, Ayala Corp., BDO Unibank,
SM Investment Corporation, Philippine National Bank, Manila Electric Company, PLDT, and Maynilad Water
Services to name a few.

Definition of terms in relation to Bonds:

Bonds – a written contract by debtor that is legally binding. It stipulates that the debtor should pay the amount
borrowed at a specified time in the future.
-interest-bearing security which promises to pay (1) a stated amount of money on the maturity date, and (2)
regular interest payments called coupon.
Redemption Value – the future value of the amount borrowed. As such it includes interest earnings.
Face Value or Par Value – refers to the original sum of money borrowed or the principal.
Maturity Date – refers to the date when the principal and interest must be paid.
Bond Rate – refers to the rate of interest used to compute for interest earnings.
Coupon –periodic interest payment that the bondholder receives during the time between purchase date and maturity
date; usually received semiannually.
Coupon Rate – usually attached to the bond associated to each payment.
-the rate per coupon payment period; denoted by r
Price of a Bond –the price of the bond at purchase time; denoted by P
Par Value or Face Value - the amount payable on the maturity date; denoted by F.
If P=F , the bond is purchased at par.
If P< F , the bond is purchased at a discount.
If P> F , the bond is purchased at premium.
Term of a Bond – fixed period of time (in years) at which the bond is redeemable as stated in the bond certificate;
number of years from time of purchase to maturity date.
Fair Price of a Bond –present value of all cash inflows to the bondholder

Example 1: Ariel Invested ₱100 000 on 3-year retail treasury bond paying 8.5% per year coupon. Compute for the
interest received every quarter and the net annual rate of return.
The gross annual interest is computed as follows:
Gross annual interest (₱100 000)(0.085) = ₱8 500
Thus, the gross quarterly interest payment is ₱ 8 500
=₱ 2125
4
Reducing this amount by 20% withholding tax, (0.80)

4| G E N E R A L M A T H E M A T I C S
 The interest received every quarter is ₱ 2 125
=₱ 1 700
0.80
The net annual rate of return is ₱ 1 700(4 )
=0.068=6.8 %
₱ 100 000
Example 2: Determine the amount of the semi-annual coupon for a bond with a face value of P300,000 that pays 10%,
payable semi-annually for its coupons.
Given: Face Value F = ₱ 300,000 Coupon Rate r = 10 %
Find: Amount of the semi-annual coupon
Solution:
Annual Coupon amount: ( 300,000 ) ( 0.10 ) =30,000

Semi-annual coupon amount: ( 30,000 ) ( 12 )=15,000

Thus, the amount of the semi-annual coupon is ₱ 15,000.
Note: The coupon rate is used only for computing the coupon amount, usually paid semi-annually. It is not the rate at
which money grows. Instead, current market conditions are reflected by the market rate, and is used to compute the
present value of future payments.

Example 3: Suppose that a bond has a face value of P100,000 and its maturity date is 10 years from now. The coupon
rate is 5% payable semi-annually. Find the fair price of this bond, assuming that the annual market rate is 4%.
Given: Face Value F = ₱ 100,000 Coupon Rate r = 5 %, payable semi-annually
Time of maturity= 10 years Number of periods= 2 ( 10 )=20
Market rate= 4 %
Solution:

Amount of semi-annual coupon: ( 100,000 ) ( 0.052 )=2,500

The bondholder receives 20 payments of ₱ 2,500 each, and ₱ 100,000 at t=10.
Present value of ₱ 100,000 :
F 100,000
P= n
= 10
=₱ 67,556.42
( 1+ j) (1+ 0.04)
Present value of 20 payments of ₱ 2,500 each:
Convert 4 % to equivalent semi-annual rate:
(2) 2
1 i
(1+0.04) =(1+ )
2
(2)
i
=0.019804
2
−n −20
1−(1+ j) 1−(1+0.019804 )
P=R =2,500 =40,956.01
j 0.019804
Price= 67,556.42+ 40,956.01=108,512.43.
Thus, a price of ₱ 108,512.14 is equivalent to all future payments, assuming an annual market rate of 4%.

WEEK 5: BONDS AND STOCKS

LESSON 3.2: STOCKS
Some corporations may raise money for their expansion by issuing stocks. Stocks are shares in the ownership of the
company. Owners of stocks may be considered as part owners of the company. There are two types of stocks: common
stock and preferred stock. Both will receive dividends or share of earnings of the company. Dividends are paid first to
preferred shareholders. Stocks can be bought or sold at its current price called the market value. When a person buys
some shares, the person receives a certificate with the corporation’s name, owner’s name, number of shares and par
value per share.
Definition of Terms in Relation to Stocks
Stocks –share in the ownership of a company. When someone buys shares of stocks of a certain company, he becomes
part owner or a shareholder of the company.
*Shareholders – earn from stocks through appreciation of the price of the stocks and by earning DIVIDENDs.
Stock Price Appreciation – refers to the increase in the market price of the stock
Dividend – share in the company’s profit
Dividend Per Share –ratio of the dividends to the number of shares
Stock Market –a place where stocks can be bought or sold. The stock market in the Philippines is governed by the
Philippine Stock Exchange (PSE)
Market Value –the current price of a stock at which it can be sold
Stock Yield Ratio –ratio of the annual dividend per share and the market value per share. Also called current stock yield.

4| G E N E R A L M A T H E M A T I C S
Par Value –the per share amount as stated on the company certificate. Unlike market value, it is determined by the
company and remains stable over time

Example 1: A certain financial institution declared a P30,000,000 dividend for the common stocks. If there are a total of
700,000 shares of common stock, how much is the dividend per share?
Given: Total Dividend= ₱ 30,000,000 Total Shares= ₱ 700,000
Find: Dividend Per Share
Solution:
Total Dividend
Dividend Per Share=
Total Shares
30,000,000
¿
700,000
¿ 42.86
Therefore, the dividend per share is ₱ 42.86 .

Example 2: A certain corporation declared a 3% dividend on a stock with a par value of ₱ 500. Mrs Lingan owns 200
shares of stock with a par value of P500. How much is the dividend she received?
Given: Dividend Percentage= 3 % Par Value= ₱ 500 Number of Shares= 200
Find: Dividend
Solution:
The dividend per share is: ( ₱ 500 )( 0.03 )=₱ 15
Since there are 200 shares, the total dividend is: ( ₱ 15 per share ) (200 shares )=₱ 3,000
In summary,
Dividend=(Dividend Percentage )(Par Value)(No. of Shares)
¿(0.03)(500)¿
¿ ₱ 3,000
Thus, the dividend is ₱ 3,000

FORMATIVE ASSESSMENT 2: STOCKS AND BONDS: Solve the following problems using appropriate formula. Show
your solution. (30pts.)
1. A financial institution declared a dividend of P5,000,000 for its common stock. Suppose there are 20,000
shares of common stock, how much is the dividend per share? (15pts.)
2. Corporation A, with a current market value of P60, gave a dividend of P10 per share for its common stock.
Corporation B, with a current market value of P85, gave a dividend of P11 per share. Use the stock yield
ratio to measure how much dividends shareholders are getting in relation to the amount invested.
(15pts.)

4| G E N E R A L M A T H E M A T I C S
WEEK 6: BUSINESS LOANS AND CONSUMER LOANS
LESSON 4.1: BUSINESS AND CONSUMER LOANS
 Loan is an amount of money that is borrowed and has to be paid back, usually together with an extra amount of
money that you have to pay as a charge for borrowing. Banks and lending institutions usually called it an
obligation.
 Business Loan is money lent specifically for a business purpose. It may be used to start a business or to have a
business expansion.
 Consumer Loan is money lent to an individual for personal or family purposes.
 Collateral an asset used to secure the loan. It may be real-estate or other investments.
 Term of the Loan is the time to pay the entire loan.

Identify whether the following is a consumer or business loan.

Example 1. Mr. Agustin plans to have a barbershop. He wants to borrow some money from the bank in order for him to
buy the equipment and furniture for the barbershop. -Business loan
Example 2. Mr and Mrs Craig wants to borrow money from the bank to finance the college education of their son. -
Consumer loan
Example 3. Mr. Alonzo wants to have some improvements on their 10-year old house. He wants to build a new room for
their 13-year-old daughter. He will borrow some money from the bank to finance this plan. -Consumer loan
Example 4. Mr. Samson owns a siomai food cart business. He wants to put another food cart on a new mall in the other
city. He decided to have a loan to establish the new business. -Business loan
Example 5. Roan has a computer shop. She owns 6 computers. She decided to borrow some money from the bank to
buy 10 more computers. -Business loan

Some problems on Business and consumer loans

Examples:
1. A son asked his father if he could buy him a laptop to work on his feasibility study entitled REDUCING GARBAGE
IN THE COMMUNITY. The father said, “I will buy you a laptop provided that you will give solutions to help the
community eradicate the garbage. His son agreed to adapt the results of his feasibility study to the community
garbage disposal. Considering this agreement, the father went to a window-shop for a laptop he could afford. He
was given a good deal in one store. A laptop worth P48,000 can be amortized for six months at 14%
compounded monthly. If the father will purchase the laptop, what will be his monthly amortization?
Solution:

( ( )
)
−n
j
1− 1+
m
P=R
j
m

( ( )
)
−6
0.14
1− 1+
12
48,000=R
0.14
12

48,000
R= =Php 8,329.82

( ( )
)
−6
0.14
1− 1+
12 ∴ The monthly payment is Php 8,329.82.
0.14
12
(This is a consumer loan because the father will use it for personal purposes. His son will use the laptop for his study.)

2. Franco Tristan Remittance Business, a start-up business, purchased 30 laptops in installment plan to support its
remittance operations group a Php 100, 000 down payment and 12 monthly payments of Php 80, 000 for their
remaining balance Php 800, 000.
a. What is the installment price of the 30 laptops?
b. How much interest rate was made if the cash price of the 30 laptops is Php 900, 000?
c. How much is the interest paid by the business per month?
d. How much is deducted from the principal loan per month?

SOLUTION:
a. Installment Price (IP) = Total of installment payments +down payment
= ( 12 x 80 , 000 ) +100 000
¿ Php 960 , 00+ Php100 , 000

4| G E N E R A L M A T H E M A T I C S
 ¿ Php 1, 060 , 000

b. Interest rate
Solve first the Interest (I) = Installment price – cash price
¿ Php 1, 060 , 000−Php 900 ,000
¿ Php 160 ,000
solve for r
I
r=
Pt
Php 160 000
¿
Php 800 000 (1)
¿ 0.2
¿ 20 %

c. Monthly Interest Payment

I =Prt
1
¿(Php 800 , 000)(0.2)( )
12
¿ Php Php 13 , 333.33

d. Amount of Principal paid per Month

Monthly Payment – Monthly Interest Payment = Principal Paid per Month
Php 80 , 000−Php 13 ,333. 33=Php66 ,666. 67

LESSON 4.2: AMORTIZATION OF A DEBT

AMORTIZATION – is a structure or an organized way to settle a debt.
To amortize a debt – means to make regular payments at equal intervals of time until a debt is paid or extinguished.
Amortization Table/Schedule – shows the outstanding balance, interest, periodic payment, and principal repayment.
Periodic Payment – takes the form of an annuity whose present value is the original amount of debt or loan. It is
inclusive of interest charges.

A portion of periodic payment goes to interest payment and the other portion goes to the principal repayment.
The interest is computed based on the outstanding balance. Thus, in the early period of amortization, a huge amount o
the periodic payment goes to interest. Though as time progresses the portion of the periodic payment that goes to the
principal repayment increases. Thus it is common to hear the term “diminishing balance”

Example 1: Richie borrowed 1 500 000 from bank and agreed to settle his obligation in 5 years. Construct an
amortization table showing equal year end deposits if money is worth 6% compounded annually.
To construct the amortization table, we first need to
compute for the periodic payment R. Interest due = A •i=0.06 ( ₱ 1500 000 )=₱ 90 000
Given: A=₱1 500 000 Solution:
j=6%=0.06 A •i ₱ 1 500 000 ( 0.06 )
R= −n = −5
=₱ 356 094.60
m= 1 1− ( 1+i ) 1−( 1+0.06 )
t= 5 years
Principal Repayment = Periodic payment – Interest Due

= ₱ 356 094.60−₱ 90 000

The amortization table is shown below.

Payment number Outstanding Balance Interest Due Periodic Payment Principal Repayment
1 ₱1 500 000 ₱90 000 ₱356 094.60 ₱266 094.60
2 ₱1 233 905.40 ₱74 034.32 ₱356 094.60 ₱282 060.28
3 ₱951 845.12 ₱57 110.71 ₱356 094.60 ₱298 983.89
4 ₱652 861.23 ₱39 171.67 ₱356 094.60 ₱316 922.93
5 ₱335 938.30 ₱20 156.30 ₱356 094.60 ₱335 938.30
₱0.00 ₱280 473 ₱1 780 473 ₱1 500 000
Notice from the table that the interest due decreases over time while the principal repayment increases over time.
Take note as well that the sum of the periodic payments of the principal repayment is the amount borrowed. The sum of
the periodic payments less the sum of the interest due is equal to the amount loan.

4| G E N E R A L M A T H E M A T I C S
 2. Find the cash prize of a gadget with a down payment of Php 2,500 and Php 3,000 every 3 months? Money is worth
1
4 % interest compounded quarterly for 24 months. Formulate the amortization schedule if a consumer decides to
5
amortize the gadget.
Answer:
cash price=down payment + present value
cash price=2,500+ P
P=?

1
j=4 %=4.20 %=0.042
5

( ) ( )
−tm
j
1− 1+
m
P=R
j
m

( )
( )
−2 ( 4 )
0.042
1− 1+
4
P=3,000
0.042
4
P=Php 22,904.57
cash price=down payment + present value
cash price=2,500+22,904.57
cash price=Php25,404.57

tm=2 ( 4 ) =8

3
3. What is the present value of an insurance policy with an annual payment of Php 25,000 at 4 % interest
4
compounded annually for 6 years? Create an amortization schedule.
Answer:
3
j=4 %=4.75 %=0.0475
4

( ) ( )
−tm
j
1− 1+
m
P=R
j
m

( ( )
)
−6 (1)
0.0475
1− 1+
1
P=25,000
0.0475
1
P=Php 127,913.15

FORMATIVE ASSESSMENT 3: BUSINESS AND CONSUMER LOANS (30pts.)

A. Identify the following whether the following illustrates a business loan or a consumer loan. (1pt. each)

4| G E N E R A L M A T H E M A T I C S
 1. Ms. Lim runs a marketing business. She wants to buy two more lots for expansion of her business. She
applied for a loan in a bank.
2. Mrs. Alonzo decided to pamper herself in a spa with her three friends. To cover the expenses, she decided
to apply for a loan.
3. Mark decided to purchase a condominium unit near his workplace. He got a loan worth P5,000,000.
B. Solve the following problems. Show your solution.
1. Myla bought a motorcycle. After paying the downpayment, the amount of the loan is P50,000 with an
interest rate of 5% compounded monthly. The term of the loan is 3 years. How much is the monthly
payment? (5pts.)
2. A small garment factory purchased 25 industrial sewing machines in instalment plan with a down
payment of Php 120 000 and 12 monthly payments of Php 65 000 for the remaining balance of Php 755
000.
a. What is the installment price of the 20 industrial sewing machines?
b. How much interest rate was made if the cash price of the 25 industrial sewing machines is Php 865,
000?
c. How much interest is paid per month?
d. How much is deducted from the principal loan per month?
3. A loan of Php 49, 300 is to be amortized by equal payments each month for 6 months. If interest is 5%
compounded monthly, find the periodic payment and construct an amortization schedule. (10pts.)
WEEK 7: LOGIC
LESSON 5.1: SIMPLE AND COMPOUND PROPOSITION
Do you still remember the different types of sentences? Can you classify the following?
 A leap year happens every four years. (declarative sentence)
 What is your name?(interrogative sentence)
 Please sign your name on the space provided. (imperative sentence-request)
 Close the door.(imperative sentence-command)
 Oh my God!(exclamatory sentence)

A proposition is a declarative sentence that is either true or false but not both. The being true (T) or false (F) of a
proposition is called its truth value. Propositions will be represented by letters like p , q , r , and so on.
We can symbolize the
Examples of propositions: Truth value prepostions as follows:
1. The month of July has 31 days. True p
2. One is prime number. False (1 is neither a prime nor composite) q
3. The sum of 10 and 6 is 16. True r
Non examples of Propositions
1. Kindly inform your classmates to bring their books tomorrow. 2. is craving for ice cream
3. Get me a glass of water. 4. 2+2
5. When is your birthday?

Classification of Propositions
1. simple proposition - a proposition that conveys a single thought or idea
Examples of simple propositions Examples of compound propositions
1.The month of July has 31 days. Today is Monday and we will have a flag ceremony.
2.Mango is a vegetable. Either you will stay at home or attend the birthday party of your friend.
3.Two is an even number. If a triangle is equilateral then it is equiangular.
4.One is prime number. I will pass the exam if and only if I study hard.
2. Compound Proposition – consists of more than one thought or idea. It is formed by combining simple
propositions using connectives. The most common connectives are and, or, if … then, and if and only if.

LESSON 5.2: Four Types of Compound Proposition

1. Conjunction - is formed when two simple propositions are joined using the connective and. Thus, if p and q are
simple propositions then, a conjunction is of the form p∧q. In symbols, we write it as p . q. The proposition
p∧q are called conjuncts.
p q p.q
T T T The following words can also be used to form a conjunction aside from the word
T F F and; but whereas nevertheless still despite
moreover yet although furthermore while
F T F
however
F F F
Note: The truth value of a compound proposition can also be determined. A conjunction is true when both conjuncts are
true. Otherwise, it’s value is false. In other words, if at least one of the conjuncts is false, the conjunction is also false.

4| G E N E R A L M A T H E M A T I C S
 2. Disjunction- is formed when two simple proposition are joined using the connective or. The disjunction of two
simple propositions p and q has the form p∨q . In symbols, we write it as p ⋎ q . The propositions p and q are
called disjuncts. A disjunction is false when both disjuncts are false. In short, a disjunction is true when at least
one of the disjuncts is true. The truth table shows the truth value for a disjunction.

p q p⋎q The following can also be used to form a disjunction: else, either…or, unless.
T T T
T F T
F T T
F F F
3. Conditional - A conditional proposition takes the form if p thenq . In symbols, we write it as p → q. The
proposition p is called the antecedent while the proposition q is called the consequent. A conditional is false
when the antecedent is true and the consequent is false. Otherwise, it is true.
p q p→q
T T T Another term for a conditional proposition is implication. The following has the same
T F F meaning as the proposition if p thenq :
F T T if ; granted only when ; provided is necessary for
q p q p; p q q p;q
F F T
p;
p entails q ; q given p ; p only if q ; p is sufficient for q ; q in case p
4. Biconditional - A biconditional proposition has the form p if ∧only if q . In symbols we write it as p ↔ q. A
p q p↔q biconditional is true when both components have the same truth values. The following
T T T truth table describes the truth value of a biconditional proposition.
The T F F following can be used to replace p if ∧only if q : p when and only when q , p just in
case F T F q , p granted that and only granted that q , in order for p, it is necessary and sufficient
that F F T q , a necessary and sufficient condition for p is q
Examples:
1. Form a conjunction, a disjunction, a conditional, and a biconditional out of the given simple propositions.
r : It is a sunny day q : We will go to the park.
Conjuction: It is a sunny day and we will go to the park.
Disjunction: Either it is a sunny day or we will go to the park.
Conditional: If it is a sunny day then we will go to the park.
Biconditional: It is a sunny day if and only if we will go to the park.
2. Determine the truth value of the following propositions.
j : June has 31 days. y : There are 12 months in a year.
To determine the truth value, we first have to identify the truth values of the simple propositions given. Note that
proposition j is false since June has only 30 days. Proposition y , on the other hand, is true. Thus,
a . j . y is false since one of the conjuncts is false
b. j ∨ y is true since one of the disjuncts is true
c . j→ y is true since the antecedent is false and the consequent is true
d . y → j is false since the antecedent is true with a false consequent
d . j↔ y is false since the components have different values
3. Symbolize the following compound propositions and determine their truth values.
a. Three is a prime number but √ 5is irrational. b.Either the province of Ifugao is in Region 2 or Mayoyao is in CAR. Let
p: 3 is a prime number Let L: The province of Ifugao is in Region 2.
i : √ 5 is irrational M: Lagawe is in CAR.
p i p .i L M L∨M
T T T F T T

WEEK 6

LESSON 2: NEGATION OF A PROPOSITION, MORE COMPOUND PROPOSITIONS, TAUTOLOGIES, AND CONTRADICTIONS

If real numbers have their corresponding negatives, propositions have their corresponding negations. The
negation of a proposition is obtained by taking its opposite. The negation of a proposition p is denoted by p. If a
proposition is true its corresponding negation is false. On the other hand, if a proposition is false its negation is true. In
truth table form we have the following:
p p
*A negation is formed using the word not or the phrase it is not the case that.
T F
F T

4| G E N E R A L M A T H E M A T I C S
Examples: 1. Negate the following propositions.
p Negation ( p ¿
1 1
is an integer. is not an integer.
2 2
Today is Sunday. It is not the case that today is Sunday
The price of gasoline increased. The price of gasoline did not increase
CONDITIONAL PROPOSITION
Given a conditional proposition p → q,
q → p is called its converse q → p is called its contrapositive p → q is called its inverse

Compound proposition can also be formed by using more than a single connective. Their truth values depend on the
truth values of their components.
Example 1. Construct a truth table for the proposition ( p → q ) ∙ p
There are only two components p andq . Thus, there are four possible
combinations of truth values for the components. In this case, we first p q p → q ( p → q) ∙ p
consider the truth value of the proposition inside the parentheses T T T T
before taking the truth value of the conjunction. The truth table is T F F F
F T T F
shown at the right.
F F T F
In general if a compound proposition has n components, there
are 2n possible combinations of truth values
of the components that should be considered in truth table.
Example 2: Construct a truth table for the proposition ( p ∨q)∙ r

The components are p , q ,and r . There are 8 possible combinations of truth values of the components (refers to the
table at the right).
p q r p ∨q ( p ∨q ) ∙ r
T T T T T
T T F T F
T F T T T
T F F T F
F T T T T
F T F T F
F F T F F
F F F F F

1. Determine the value of the proposition ( p ∙ q)↔ p ∨ q .

There are only two components that require four possible combinations of truth values. Notice however, that
there are 3 connectives considered plus negations. The truth table can be formed as follows:
p q p∙q ( p ∙ q) p q p∨ q ( p ∙ q)↔ p ∨ q .
T T T F F F F T
T F F T F T T T
F T F T T F T T
F F F T T T T T
The proposition in example 4 is called a tautology. A tautology results when the truth values of a proposition are all true
for all the possible combinations of truth values of its components. Opposite to a tautology is a contradiction. In a
contradiction, the truth values of the proposition are all false for all possible combinations of truth values of its
components. A contradiction is also called a fallacy. In cases that the possible combinations are not all true or not all
false, we have a situation called a contingency.
Note that the simplest tautology that can be formed is the disjunction of a proposition and its negation. The simplest
form of a contradiction is the conjunction of a proposition and its negation. In symbols, p ∨ pis a tautology while
p ∙∼ p is a contradiction. In these cases, the proposition p can be simple or compound. Remember also that the
negation of a tautology is a contradiction and the negation of a contradiction is a tautology.

Lesson 3: Arguments and Validity

A proposition P logically implies a proposition Q if and only if P →Q is a tautology. This means that the truth value of Q
is true whenever the truth value of P is true. In this case, we can also say that Q logically follows from P . In symbols,
P ⟹Q .
Two propositions P and Q are said to be logically equivalent if and only if P and Q have the same truth values
for all possible combinations of the truth values of the components. In symbols, we write P ≡Q . Note in both cases that
P and Q can be simple or compound propositions.
An argument is a set of propositions divided into hypotheses and conclusion.

Example:

4| G E N E R A L M A T H E M A T I C S
 Symbolize the given argument and determine if it is valid or not.
If I study then I have good chances of passing the exam. If I do not study then I can attend the party. Therefore,
either I have good chances of passing the exam or I can attend the party.
Let the simple propositions be represented as follows.
s: I study p: I have good chances of passing the
s→ p
exam a : I can attend the party.
The argument can be symbolized as: s→ p
∴ p ∨a

To check if the argument is valid, we have to verify if [ ( s → p ) ∙ ( s → a ) ] →( p ∨a ¿ is a tautology.

s p a s→ p s s→a ( s → p )∙ ( s → a ) p ∨a [( s → p )∙ ( s → a ) ] →( p ∨a ¿
T T T T F T T T T
T T F T F T T T T
T F T F F T F T T
T F F F F T F F T
F T T T T T T T T
F T F T T F F T T
F F T T T T T T T
F F F T T F F F T
Since we have a tautology, then the given argument is valid.

FORMATIVE ASSESSMENT 4: LOGIC (30pts.)

A. Determine whether each of the following statements is a proposition or not. If it is a proposition,
give its truth value. (1pt. for not proposition & 2pts. for proposition with correct truth value)
_____1. Wow, it’s fun in the Philippines!
_____2. −1+2=−3
_____3. Zero is a positive number.
B. Symbolize the given statements and determine the truth value: (3pts. each)
________1. −6> 5 or 16=16
________2. The English alphabet has 26 letters when and only when mystery an eight-letter word.
________3. 2015 is even but 2 is composite.
C. Consider the given:
p → q: “If the sum of two and five is seven, then the product of two and five is ten.”
Write in words and in symbol the
(a) Converse(2pts.) (b) Contrapositive(2pts.) (c) Inverse(2pts.)

D. Using a truth table, determine whether the compound proposition is a tautology, contradiction, or a
contingency. (10pts.)
Given: ( p → q)↔ [ p →( p ∙ q) ]

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