SIMPLE INTEREST COMPOUND INTEREST

1. How long will it take ₱1000 to earn ₱125 interest if invested 1. If ₱7500 is invested at 8% compounded quarterly, find the (a)
at 10%? compound amount and (b) compound interest at the end of
½ years.

2. Find the amount due at the end of the 10 years and 9 months
if ₱4200 is invested at 9% compound quarterly.

2. How long will it take ₱3000.00 to accumulate to ₱9600.00 at

8% simple interest rate?

3. Accumulate ₱3000 for 2 years and 7 months at (a) 7% simple

interest; and (b) 9% compounded monthly.

4. Find the present value of ₱6000 due at the end of 4 years, if

money is worth 10% compounded semi-annually.

3. At what interest rate will ₱12000 earn ₱3780 interest rate 3

½ years?

5. (a) Discount ₱8750 for 5 years and 3 months at 8%

compound quarterly (b) Discount?

6. What principal will have to be placed on deposit to

4. At what interest rate will ₱10400 increase to ₱12831 in 2 yrs accumulate to ₱9000 at the end of 7 years and 6 months if
and 9 months? money earns interest at 9% compounded bimonthly?

7. Mr. Cruz owes Mr. Reyes ₱30500 due now. Mr. Cruz offers to
pay the principal a simple interest at the rate of 5% after 3
years. Mr. Reyes insists on charging 5% compounded quarterly.
Who benefits from that offer? By how much?
5. What sum of money which is invested now at 9 1/2% will
amount to ₱7975 at the end of 8 months?
LOGARITHMIC METHOD: INTEREPOLATION METHOD:
(Interest) (Interest)
1. At what rate, compounded quarterly, must money be 1. If interest is compounded quarterly, find the
accumulated so that ₱6000 will became ₱18530 at the end nominal rate at which ₱4500 accumulates to ₱7000
of 12 years? at the end of 6 years?

(Time) (Time)
2. How long will it take ₱ 4000 to accumulate to ₱5000 at 9%, 1. How long will it take money to double itself
compounded semi-annually? at 8% compounded quarterly?
 INTERPOLATION AND LOGARITHMIC METHOD
(Interest)
1. Mr. Cruz plans to invest ₱45000 on his son’s birth for his
son’s education in 5 years later. If Mr. Cruz wishes to have
₱80000 by that time, at what rate converted quarterly
should be invest his money?

2. If San Miguel pays ₱6000 now instead of ₱11000 at the end of 7

years and 9 months, at what rate, compounded quarterly, does
money earn interest?
3. At what rate compounded semiannually will ₱18000 amount to
₱25000 in 5 years?

(Time)
4. In how many years will ₱6500 accumulate to ₱10000 if it is
invested at 12% compounded quarterly?
5. How long will it take for ₱6000 to accumulate to ₱11300 1. How long will it take ₱5000 to accumulate
at 6% compounded semiannually? to ₱13000 if invested at 8% compounded
semi-annually?

1. How long will it take ₱3000 to amount to ₱3500 at 9%

compounded bimonthly?
ORDINARY ANNUITY 6. To provide for Christine Joyce’s education, her mother
Future Value deposits ₱200 at the end od each month for 16 years. If the
1. Find the amount of annuity of ₱500 payable at the end of money earns 10% interest, converted monthly, how much
each 3 months for 8 years if money is worth 12% does the fund contain just after the 15th deposit if made? If
compounded quarterly. no more deposit is made after the 100th deposit but the
fund is allowed to accumulate at the same rate, how much
will it contain at the end of 16 years?

2. To buy a second hand car in 5 years, Jun Dionisio deposits

₱ 1500 a month at a bank paying 9% interest, converted
monthly. How much will he have after such period.
7. Feddie Gapas received an inheritance of ₱25000 a year
when he was 12 years old. However, this was to be invested
and allowed to accumulate at 7% effective until he reaches
at the age of 21. What will be its amount when he reaches
the age of 21?

3. Marc Anthony’s father deposits ₱400 at the end of 3

months in a fund paying 10% interest, compounded 8. Roland Carlos deposits ₱6000 at the end of each 6
quarterly. What amount will the fund payment contain just months for 7 years in a bank paying 9% converted
after 12 years? semiannually. He then allowed his account to accumulate at
the same interest rate for 3 more years without making any
more deposits. What is the amount on his account at the end
of 10 years?

4. Find the amount of an annuity of ₱2500 a month for 15

years at 8% compounded monthly.
9. If ₱450 is deposited at the end of every second month in an
account that pays 9% converted bimonthly, how much will
be in the account at the end of 5 years and 10 months?

5. Christine Grace’s auntie puts ₱700 at the end of every 3

months in a savings account that pays 9% interest, 10.To replace his sala set, Teddy Palomo made quarterly
compounded quearterly. If the first was made on January deposits of ₱800 each in a fund that paid 12% compounded
15, 1989, how much will she have in her account just quarterly. How much was in the fund at the end of 2 ½
after her deposit on October 15, 1999? years?
Present Value 6. Find the value today of an annuity of ₱12500 at the end of
1. What deposit in a trust bank will supply an income of each year for 12 years, if money is worth 8% effective for the
₱4000 per quarter for 6 years, if the bank’s rate is 8%, first 5 years and 7% effective during the last 7 years.
compounded quarterly?

7. A building is leased for 5 years at ₱20000 per month. Find the

cash equivalent of the lease at 8.4% compounded
2. If money is worth 7% to the buyer of a lot, which is better semiannually.
for him and by how much: to pay ₱250000 cash or ₱60000 a
year for 5 years?

8. A contract calls 20 semiannual payments of ₱75000 each.

Find the present value of the contract if money is worth 7.2%
compounded semi-annually.
3. If money is worth 7 ½ % converted semiannually, what
single payment now is equivalent to 10 semiannual payments
of ₱6250?

9. At the time of his son’s birth, a man invests a certain sum of

money at compounded quarterly to provide quarterly
payments of ₱6000 each for four years, the first payment to
be made on his son’s 20th birthday. How much does the
4. How much will it cost to purchase an annuity of ₱3000 at father invest?
the end of every 3 months for 8 years, if money is worth 9%,
m=4?

10.On his 45th birthday, a man buys an annuity from an

insurance company which credits interest at 0.09, m=12. The
annuity will provide 15 years of ₱3000 monthly payments to
himself or his wife, and its term will begin on his 50th
5. A house sells for ₱4800 a month for 15 years. Find the birthday. What single payment does he make on his 45th
equivalent cash price if money is worth 10%, converted birthday?
monthly.
PERIODIC PAYMENT OF ANNUITY DUE 6. Melvin Marquez wishes to accumulate ₱170000 in 5
years. How much should be invested each quarter at
1. In need of ₱200000 in 10 years with 10% quarterly. What
10% compounded quarterly?
is the periodic payment.

7. Gabby Montano has an obligation of ₱15000 due at

the end of ½ year. How much must he set aside every
month at 9%, compounded monthly, in order to
2. The description for a fund is to contain ₱245000 at the
repay the loan when it is due?
end of 3 years. What equal quarterly deposits must be into
this fund. If money is worth 10% compounded quarterly?

8. A man owes ₱80000 due at the end of 8 years. How

3. A man deposited ₱30000 in a fund paying 9%
much should how much must he set aside at the end
compounded semiannually. How much may be withdrawn
of every 6 months to accumulate to the amount of
at the end of each 6 months for 5 years so that nothing will
the debt if money is worth 8%, compounded
be left in the fund after last withdrawal?
semiannually.

4. A debt of ₱3500 is due now. Find the monthly payment

9. A debt of ₱25000, with interest at 8%, compounded
necessary to cancel the obligation in 1.5 years, 9%, m=12.
quarterly, will be discharged by equal payments at
the end of each 3months for 4 years and 6 months.
Determine the amount of each payment.

5. A man buys piano for ₱75000 and agrees to pay the debt
by quarterly payments at 9%, compounded quarterly, over
the next 3 years. How much is the quarterly payment?
ANNUITY DUE
Future Value 4. The periodic payments of an annuity due are ₱4000 each
1. An annuity due contract provides for the payment of ₱8750 and are payable semiannually for 12 years. If money is
on the first of each quarter for 8 years. If money earns worth 8% compounded semiannually, what is the present
interest at 10% compounded quarterly. What is the amount value of annuity?
of annuity at the end of the term?

2. A man deposits ₱3600 at the beginning of each 3 months in 5. At 7%, compounded quarterly, what is the present value
a bank which pays interest at a rate of 10% converted of an annuity due of ₱7500 every 3 months for 5 years
quarterly. How much will be in his account after 7 ½ years? and 9 months?

Present Value
1. If money is worth 8% compounded quarterly, what is tge 6. Find the present value and the amount of annuity due of
present value of an annuity due of ₱300 every 3 months in 10 ₱6250 payable every 2 months for 3.5 years at a 12%
years. compounded bimonthly.

2. What is the present value of an annuity due in which a

payment a ₱600 is to be made at the beginning of each 7. A man agrees to make equal payments of ₱5000 at the
month for 5 years if money is worth 9%, compounded beginning of each year to discharge a debt due in 15
monthly? years. If money is worth 7%, compounded annually, how
much does he owe?

3. In buying a house and lot, Rody Geronimo agrees to pay

₱2000 at the beginning of each month for 15 years. If money
is worth 12% compounded monthly, what is the equivalent
cash price of the house and lot?