Republic of the Philippines

Department of Education
National Capital Region
DIVISION OF CITY SCHOOLS – MANILA
Manila Education Center Arroceros Forest Park
Antonio J. Villegas St. Ermita, Manila

BUSINESS FINANCE
Quarter 1 Week 7 Module 8
MATHEMATICAL CONCEPTS AND TOOLS IN COMPUTING
FOR FINANCE AND INVESTMENT PROBLEMS

Learning Competency:
The learners shall be able to apply mathematical
concepts and tools in computing for finance and
investment problems.
ABM_BF12-IIIg-h-21 Week 7
 Learning Module for Business Finance

HOW TO USE THIS MODULE?

Before starting the module, I want you to set aside other task/s that
may disturb you while enjoying the lessons. Read the simple instructions
below to successfully enjoy the objectives of this kit. Have fun!

1. Follow carefully all the contents and instructions indicated in

every page of this module.
2. Write on your notebook the concepts about the lessons. Writing
enhances learning, that is important to develop and keep in mind.
3. Perform all the provided activities in the module.
4. Let your facilitator/guardian assess your answers using the
answer key card.
5. Analyze conceptually the posttest and apply what you have
learned.
6. Enjoy studying!

PARTS OF THE MODULE

 Expectations - These are what you will be able to know after
completing the lessons in the module.
 Pre-test - This will measure your prior knowledge and the
concepts to be mastered throughout the lesson.
 Looking Back to your Lesson - This section will measure what
learnings and skills did you understand from the previous
lesson.
 Brief Introduction- This section will give you an overview of the
lesson.
 Activities - This is a set of activities you will perform with a
partner.
 Remember - This section summarizes the concepts and
applications of the lessons.
 Check your Understanding - It will verify how you learned from
the lesson.
 Post-test - This will measure how much you have learned from the
entire module

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 Learning Module for Business Finance

Mathematical Concepts and Tools in

Computing for Finance and Investment Problems

EXPECTATIONS

At the end of the module, you will be able to apply mathematical

concepts and tools in computing for finance and investment problems.
Specifically, this module will help you to compute for the net
present value of a project with a conventional cash-flow pattern.

Let us start your journey in learning more

PRETEST
on mathematical concepts and tools in computing
for finance and investment problems. I am sure
you are ready and excited to answer the Pretest.
Smile and Enjoy!
I. MULTIPLE CHOICE
Directions: Choose the letter corresponding to the correct answer for each
of the questions provided below.
1. The process of planning expenditures that will influence the
operation of a firm over a number of years is called
a. Capital budgeting c. Investment
b. Dividend d. Net present valuation
2. Which of the following is an example of a capital investment
project?
a. Development of employee training programs
b. Expansion of production facilities
c. Replacement of worn out equipment
d. All of the above
3. The net present value of a project is equal to
a. the present value of all net cash flows that result from the
project.
b. the present value of all revenues minus the present value of all
costs that result from the project.

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 Learning Module for Business Finance
c. the present value of all future net cash flows that result from
the project minus the initial investment required to start the
project.
d. All of the above
4. The net present value method and the internal rate of return
method will always yield the same decision when
a. a single project is evaluated.
b. mutually exclusive projects are evaluated.
c. a limited number of projects must be selected from a large
number of opportunities.
d. All of the above
5. All of the following are methods used for evaluating capital
expenditures except:
a. Internal rate of return
b. Net present value
c. Payback method
d. Weighted average cost of capital

Great, you have finished

answering the questions. You may
request your facilitator to check your
LOOKING BACK TO YOUR LESSON work. Congratulations and keep on
learning!

Recall from the previous discussions that future value is the

amount to which an investment will grow after earning interest while present
value is the amount invested today to produce a certain amount of cash flow
in the future. The formula in calculating future value (FV) and present value
(PV) are as follows:
= × (1 + )

=
(1 + )
The three (3) basic patterns of cash flow are the following:
In Single Amount (Lump Sum), a single cash outflow is made and the
total receipts will be at a single future date; while Annuity is a periodic stream
of equal cash flow at equal time intervals (annually, monthly, etc.), and the
Mixed Stream is unequal periodic cash flows that reflect no particular pattern.

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 Learning Module for Business Finance
As part of recall from the previous discussions, try to answer the
following questions.
I. MULTIPLE CHOICE
Directions: Choose the letter corresponding to the correct answer for each
of the questions provided below.
1. Which of the following answers have two terms that are
synonymous?
a. Future value and present value
b. Today’s peso and time value of money
c. Inflation and future value
d. Inflation and time value of money
2. Time value of money is an important finance concept because:
a. It takes risk into account
b. It takes time into account
c. It takes compound interest into account
d. All of the above
3. Which of the following is the formula to calculate the present value
of a future payment?
a. PV = (FV / r) *t c. PV = FV / iT
b. PV = (I / t) *FV d. PV = FV / (1 + r)
4. What is Annuity?
a. Annuity is a series of payments to be received during a period
of time.
b. Annuity is a series of payments to be received at a common
interval during a period of time.
c. Annuity is a series of equal payments to be received at a
common interval during a period of time.
d. Annuity is the present value of a set of payments to be received
during a future period of time.
5. Which of the following statement is correct?
a. Simple interest pays interest on your previous balance plus
your previous earned interest; compound interest pays interest
only on your original balance.
b. Compound interest pays interest on your previous balance
plus your previous earned interest; simple interest pays
interest only on your original balance.
c. Banks with compound interest pay interest more reliably.
d. The formula for compound interest includes more elements.

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BRIEF INTRODUCTION

Answer the following questions in your notebook as we continue to

discuss our new topic.
What are your considerations in entering a new business?
Is there a market for the product/services you want to offer?
Are the products/services you plan to offer basic necessities or not?
Can you identify the players in the industry?
What are the salient features/competitive edge of the
product/services you plan to offer?
Do you have the managerial competence and technical expertise to
run the business?
Do you have distribution channels by which you can sell you
products/services?
Do you have the financial resources to start and operate the
business?
In entering a business or making expansion decisions, the question
that stands to be answered shall be, “Will the profits earned from the
business for a given amount of time be enough to cover or even be greater
than the amount of capital invested?” The main objective is, of course, to
maximize shareholder’s wealth. This also applies to questions regarding
business expansion.
Read the following scenario to further introduce the topic.
Eli Lilly and Company
Riding the Pipeline
by Lawrence J. Gitman

Companies spend money on new investments if they believe that

those investments will later generate enough cash flow to justify the up-
front cost. For pharmaceutical companies like Eli Lilly, the average length

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of time from the discovery of a new drug until delivery to a patient is 10 to
15 years. After R&D produces a promising lead, a drug is still a long way
from being ready for human testing. Researchers must probe further to
determine what dosage will be required and at what level it might be toxic
to the patient. They also must explore practical issues such as whether
Lilly will be able to manufacture the compound on a large scale. The
clinical trials themselves can take years. To help recoup its investment, a
drug manufacturer can get a 20-year patent that grants the company
exclusive rights to the new drug. However, with the lengthy research and
approval process, companies may have fewer than 10 years to sell the drug
while the patent is in force. Once patent protection expires, generic drug
manufacturers enter the market with low-priced alternatives to the name-
brand drug.
For Eli Lilly, the cost of bringing a new drug to market runs from
$800 million to $1.2 billion. To keep its drug pipeline full, Eli Lilly plows
some 20 percent of sales back into the R&D programs on which its future
depends. With large cash expenditures occurring years before any cash
return, the time value of money is an important factor in calculating the
economic viability of a new drug.
Let me share to you another article related to capital expenditure or
business expansion. Agcaoili, L. (2015). Cebu Pacific buying 16 ATR planes
for $673 M. philstar.com. Retrieved 11 April 2016, from
http://www.philstar.com:8080/business/2015/06/17/1466623/cebu-
pacific-buying-16-atr-planes-673-m.
MANILA, Philippines - Budget airline Cebu Air Inc. (Cebu Pacific) of
taipan John Gokongwei is spending $673 million to acquire 16 more brand
new aircraft from Toulouse-based turboprop aircraft maker ATR to meet
the growing demand for inter-island services in the Philippines.
Lance Gokongwei, president, and chief executive officer of Cebu

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Pacific said the acquisition of 16 ATR72-600 is in line with the low-cost
carrier’s vision of providing affordable air travel.
“This order is an affirmation of our commitment to extend the
convenience of affordable air travel to even more communities. We are
pleased to be the launch customer of this new configuration of the ATR 72-
600, as this will allow us to offer our customers more seats at even lower
fares,” he said.
He pointed out Cebu Pacific has been operating ATR aircraft since
2008 enabling the budget airline to bring safe, reliable, and affordable air
transport to smaller cities and islands throughout the Philippines.
According to Cebu Pacific, the transaction would double the airline’s
turboprop fleet size. It currently operates a fleet of eight ATR 72-500
aircraft that would be retired as the new aircraft enter service.
Gokongwei said the entry into service of the ATR 72-600 would see
Cebu Pacific with new generation aircraft to meet a growing demand in the
Philippines for inter-island services. The aircraft were ordered from
European turboprop aircraft maker ATR at the Paris Air Show.
The deal also includes options to acquire an additional 10 ATR72-
600. The aircraft is equipped with the high density Armonia cabin, the
widest cabin in the turboprop market.
The aircraft features 78 slim-line seats and wider overhead bins with
30 percent more stowage space. These new technological innovations
further enhance space and comfort for passengers.
About 330 ATRs are currently operated by 55 airlines in the Asia-
Pacific region. The ATR 72-600 has the lowest cost per seat mile in the 70-
seat segment, with significantly lower fuel and maintenance costs
compared to similar class aircraft.
ATR chief executive officer Patrick de Castelbajac said the aircraft
manufacturer is “very happy to continue our partnership with one of the

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leading airlines in Southeast Asia and to contribute to the expansion of its
network throughout the islands of the archipelago”.
“Cebu Pacific will also be able to benefit from the vast support
network for ATR operators in Asia. When their first ATR 72-600 arrives,
there will be five ATR pilot training centers in the region,” he said.
Cebu Pacific is undertaking a $4-billion fleet renewal program. It is
scheduled to take delivery of seven more Airbus A320 and 30 A321neo
between this year and 2021. It has a fleet of 55 aircraft composed of 10
A319, 31 A320, six Airbus A330, and eight ATR-72 500 aircraft.
Meanwhile, the low-cost carrier arm of national flag carrier
Philippine Airlines Inc. (PAL) of taipan Lucio Tan is set to fly to Saipan in
Northern Marianas two times a week using the 156-seater Airbus A320
aircraft.
PAL Express said it intends to attract Saipan residents to fly to
Manila and interconnect to any of the PAL Groups domestic and
international destinations. There are about 19,000 Filipinos living and
working in Saipan.
“Our goal is to address the clamor for new routes to best serve the
needs of the market. As we tap new markets and build on existing ones,
we aim to ensure connectivity across the route network of the PAL Group
by providing the required flight frequencies and schedules,” the airline
said.
Use and answer in your notebook the following guide questions in
analyzing finance and investment problem:
What was the company’s expansion plan?
How much was the cost of the long-term investment?
What were their expected returns on this expansion plan?
What are the company’s stands to gain in their expansion decision?
Answers may be: Gain in market share, increase in profits, and

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increase in shareholder value.
What are the possible means to evaluate the viability of the
expansion plan?
Answers may be: Market research and feasibility study (on whether
the expected capital outlay can be outweighed by the expected profits from
the additional demand the company can cover, and whether a demand
exists).
Long-term investments need significant capital outlay thus careful
analysis should be done. A company needs tools that can be used in
evaluating which investments to take, and which to forego. This introduces
us to our topic on Capital Budgeting.
CAPITAL BUDGETING
It is the process of evaluating and selecting long-term investments
that are consistent with the firm’s goal of maximizing owners’ wealth.
Long-Term Investment Versus Operating Expenses
Long-term investment results in benefits to accrue to the company
in excess of one year while operating expenses benefits the company only
within the operating period.
Examples of capital expenditure
• Expand or enter into a new line of business
• Replace or renew fixed assets
• Construct new premises
• Opening a new branch
• Acquisition of machineries and equipment
The steps in Capital Budgeting
1. Investment Proposal. Proposals for capital expenditure come
from different levels within a business organization. These are submitted
to the finance team for thorough analysis.
2. Review and Analysis. Financial personnel perform formal review

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and analysis to assess the benefits and cost of the investment proposals.
These personnel make use of several financial tools which they see fit in
evaluating the project.
3. Decision Making. Companies usually delegate capital
expenditure decisions on the basis of value limits. The analysis is
presented to the proper approving body who will in turn make the decision
on whether to push through with the project or not.
4. Implementation. Release of funds and start of the project occurs
after approval. Large expenditures are usually released in phases.
5. Monitoring. Results are monitored and actual cost and benefits
are compared with those that were expected. Action may be required if
deviations from the plan are significant in amount.
THE RISK AND RETURN TRADE-OFF
In making investment decisions, financial managers take note of the
risk and returns of the projects they are entering.
Recall the story of Jack and the Beanstalk. In the story, Jack trades
his cow for three magic beans. This is a very risky move for Jack since
these beans may be fake and therefore, worthless. Luckily, those magic
beans grew into beanstalk that gave Jack the opportunity to gather riches
beyond his wildest dreams, while fighting with a giant along the way. Jack
gambled in this transaction. Should Jack decide not to sell the cow for
magic beans and instead sold it at the current market value, the story
would be different. As we can see, the higher the risk, the higher the
returns, but of course, if turned sour, the higher the losses as well.
This situation is also true for making financial decisions. Taking a
higher risk gives you the opportunity to earn higher returns. Low risk
investments like treasury notes, also called risk-free instruments, earn a
low- and steady-income flow. In making investment decisions, financial
managers ensure that the proposed business will earn more than the risk-

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free rate since they need to compensate for the risk the investment will
entail. This introduces us to the Required Rate of Return. It is the
minimum expected yield investors require to select a particular
investment.
See, how the risk and return trade-off can be applied in your real
life? Possible answers are:
• Fixed income vs. commission-based income
• Earning interest from time deposits vs. earning from stocks
• Entering in a business with steady income vs. entering into
seasonal high profit business
• Investing in preferred vs. common stock
Basic terminologies related to capital budgeting
Independent vs. Mutually Exclusive Investments
Independent Projects are those whose cash flows are independent of
one another. The acceptance of one project does not eliminate the others
from further consideration. Mutually exclusive projects, on the other hand,
are projects which serve the same function and therefore compete with one
another. The acceptance of one eliminates all other proposals that serve a
similar function from further consideration.
Unlimited Funds vs. Capital Rationing
The amount and availability of funds affects the company’s decisions
in capital outlays. If the company has unlimited funds, then all projects
which pass the risk-return criteria will be accepted and implemented.
Otherwise, firms will operate under capital rationing and will accept only
projects which provide the best opportunity to increase shareholder
wealth.
Accept-Reject vs. Ranking Approaches
The Accept-Reject approach is usually done for mutually exclusive
projects where one project is favored over the others. The approach accepts

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projects which pass a certain criterion. Ranking is done when there are
several projects passing the criteria and the company is only able to fund
so much. The highest-ranking projects will be selected for implementation.
THE DIFFERENT TECHNIQUES IN CAPITAL BUDGETING
Before proceeding with discussion of techniques, let us first
introduce the concept of relevant cash flows. Relevant cash flows include
the initial investment, cash inflows from income from the project, and the
expected terminal value of the project, if any. These are the cash flows
considered in analyzing whether an investment adds value to the firm.
Cash flows should be net of tax. However, to simplify our discussion, we
shall not include tax in our consideration.
For example, Mr. Alfonse is deciding on which of the 2 mutually
exclusive projects he should accept. Project A requires an initial outlay of
PHP72,000 and is expected to receive PHP17,000 annually for the next 5
years. Project B, on the other hand, requires an investment of PHP80,000
but will earn PHP21,000 annually for the next 5 years. In this example, we
can see that the relevant cash flows are the upfront investment and the
annual income from investment.

Payback Method
This is the simplest method used in capital budgeting. It
measures the amount of time, usually in years, to recover the initial

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investment. To illustrate this method, let us use our previous examples
for relevant cash flows.
For Project A, the initial cash flow is PHP72,000. In 4 years, Mr.
Alfonse would have generated a total cash flow of PHP68,000. To get the
actual time period, let us divide the remaining amount (4,000) * and divide
it by the cash flow for year 5. We get .24, so the total payback period for
Project A is 4 + .24 = 4.24 years. Conversely, if the cash flows are equal, you
may derive the answer by dividing the initial cash flow by the annuity,
72,000/17,000 = 4.24 years. Using this method for Project B, we
get the payback period of 80,000/21,000 = 3.81 years.
Let us also illustrate an example of computing the payback
period for uneven cash flows. Initial Investment = 15,000

Year 1 = 7,000
Year 2 = 4,000
Year 3 = 6,000
Year 4 = 3,000

For years 1 and 2, we have already recovered 11,000 of our

investment. We need 4,000 more to reach 15,000 thus for the
third year, we have 4,000/6,000 = 0.67. The payback period is
2.67 years. Notice that the cash flow for year 4 is already ignored.
Managers usually set an acceptable payback period for
projects. For making accept-reject decisions, projects which meet
the set acceptable payback period shall be accepted and those
which are not discarded. It is a popular method used especially
for small projects due to its simplicity and consideration for the
timing of cash flows. The criticism of this method, however, it that
it does not consider the time value of money. Also, it fails to
consider the cash flows after the payback period. For instance, in
our previous example, we can see that Project B is better
compared to Project A due to the quick recovery of the investment.
If Project A has a cash flow of, let us say PHP50,000 at year 5, we
can easily deduce that Project A is more profitable. However, the
payback method only recognizes the gains during the payback
period.

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Net Present Value (NPV)
This method is more sophisticated than the payback method
since it considers the time value of money and it considers all the
cash flows during the life of the project including the terminal
value. The NPV can be computed by comparing the present value
of cash inflows against the present value of cash outflows. Cash
flows are discounted using the firm’s cost of capital (cost of
acquiring funding needs) to get the present values. NPV = Present
value of cash inflows – present value of cash outflows. If the NPV
of a project is zero or positive, it should be accepted. In finance, if
these projected cash flows are realized, the NPV of the project
should be equivalent to the increase in total shareholder’s value.
Assuming that the cost of capital is 8%, let us compute the
NPV for our previous example.

Project A = 17,000 x PVAF (3.993) – 72,000 = 67,881 –

72,000 = (4,119)

For the NPV of Project B

Project B = 21,000 x PVAF (3.993) – 80,000 = 83,853 –

80,000 = 3,853

We can see that Project A’s NPV is negative and Project B’s
NPV is positive, thus, we only accept project B.

Internal Rate of Return (IRR)

The IRR is one of the most widely used techniques in capital

budgeting. It is defined as the discount rate that equates the NPV
of an investment to zero. If this method is used for capital
budgeting analysis, the project’s IRR is compared to the
company’s cost of capital. If the IRR is greater than the cost of
capital, the project should be accepted otherwise, it should be
rejected. Manual computation of the IRR involves trial and error;
however, this IRR computation is a lot easier using computation
applications like MS Excel.

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For example, you are planning to build a branch for your
business at PHP350,000 and expect to receive PHP400,000 in 1
year. First, compute for the rate of return (profit/investment).

Rate of return = 50,000/350,000 = 14.3%

We compute for the rate of return because the NPV of a

project with cost of capital equal to the rate of return is equal to
zero. To illustrate:

NPV = 400,000/ (1+0.143) – 350,000 = 0

The IRR can easily be computed using MS Excel using the

IRR function.
The NPV and IRR are interrelated techniques. An IRR greater
than the cost of capital equates to a positive NPV and vice versa.
On a purely theoretical view, NPV is the better measure since it
measures the actual cash value a project creates for shareholders.
However, IRR is also a widely used tool since financial managers
usually like to think in terms of ratios and percentages.

Take the Challenge

Activity No.1

Directions: Write TRUE if the statement is correct; write FALSE if the

statement is wrong. Write your answer on the space provided before the
number.
______1. Capital budgeting is a decision-making process of selecting both

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short-term and long-term investments.
______2. The initial investment is the immediate cash outflow necessary to
purchase the asset and put it into operating order.
______3. One disadvantage of the payback period method is it ignores time
value of money.
______4. Accepting positive NPV projects will reduce shareholders’ wealth.
______5. If NPV is negative, the project is expected to earn more than the
firm’s cost of capital.

Activity No. 2

MATCHING TYPE
Directions. Match column A to Column B. Write the letter of the correct
answer on the space provided before the number.
Column A Column B
______1. It considers the time value of money a. Capital budgeting
and all the cash flows during the life b. Independent projects
of the project. c. Accept-Reject Approach
recover the initial investment. e. Net Present Value
______3. It is done for mutually exclusive f. Capital Rationing
projects where one project is
favored over the others.
______4. Projects whose cash flows are independent
of one another.
______5. It is the process of evaluating and selecting
long-term investments that are consistent
with the firm’s goal of maximizing owner’s
wealth.

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REMEMBER

Capital budgeting is the process of evaluating and selecting long-

term investments that are consistent with the firm’s goal of maximizing
owners’ wealth.
The three (3) different techniques in capital budgeting are the
following: Payback Method is the simplest method used in capital
budgeting. It measures the amount of time, usually in years, to recover
the initial investment. Net Present Value (NPV), a more
sophisticated than the payback method, considers the time value
of money and all the cash flows during the life of the project
including the terminal value. The NPV can be computed by
comparing the present value of cash inflows against the present
value of cash outflows. Cash flows are discounted using the firm’s
cost of capital (cost of acquiring funding needs) to get the present
values. NPV = Present value of cash inflows – present value of
cash outflows. If the NPV of a project is zero or positive, it should
be accepted. In finance, if these projected cash flows are realized,
the NPV of the project should be equivalent to the increase in total
shareholder’s value. Internal Rate of Return (IRR), the most
widely used techniques in capital budgeting, is defined as the
discount rate that equates the NPV of an investment to zero. If
this method is used for capital budgeting analysis, the project’s
IRR is compared to the company’s cost of capital. If the IRR is
greater than the cost of capital, the project should be accepted
otherwise, it should be rejected.

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CHECK YOUR UNDERSTANDING

Multiple Choice
Directions: Choose the letter corresponding to the correct answer for each
of the questions provided below.
1. Under the payback period:
a. we compute the time required to recoup the original investment
b. there is no consideration of inflows after the cutoff period
c. the time value of money is ignored
d. All of the above
2. One of the main advantages of the payback period is:
a. it is easy to use and places a premium on liquidity
b. it ignores the time value of money
c. all inflows related to the decision are considered
d. outflows are equated with inflows using the rate of return
3. Under the net present value method:
a. the interest rate is determined that equates inflows and outflows
b. the time value of money is not taken into account
c. inflows are discounted back to determine if they exceed outflows
d. the basic discount rate is the internal rate of return
4. The internal rate of return method:
a. does not consider inflows after the cutoff period
b. calculates the interest rate that equates outflows with subsequent
inflows
c. determines the time required to recoup the initial investment
d. determines whether future benefits justify current expenditures
5. The difference between the present value of cash inflows and the
present value of cash outflows associated with a project is known as:
a. Net present value of the project
b. Net future value of the project
c. Net historical value of the project
d. Net salvage value of the project

POSTTEST

Multiple Choice
Directions: Choose the letter corresponding to the correct answer for each of
the questions provided below.

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1. If present value of total cash outflow is Php20,000 and present
value of total cash inflow is Php19,000, what is the net present
value of the project?
a. Php1,000 c. 0
b. -Php1,000 d. Php2,000
2. Generally, a project is considered acceptable if its net present
value is:
a. Negative or zero c. Negative
b. Negative or positive d. Positive or zero
3. The net present value of four projects is given below:
a. Project A Php25,000 c. Project C Php22,000
b. Project B Php10,000 d. Project D Php15,000
3. The four projects require the same amount of investment. How
would you rank them using Net Present Value (NPV) method?
a. A, B, C, D c. B, D, C, A
b. A, C, D, B d. B, C, D, A
4. A firm is considering three investment projects. Each project has
an initial cost of Php1 million. Project A offers an expected rate of
return of 16%, B of 8%, and C of 12%. The firm's cost of capital is
6% if it borrows Php1 million, 10% if it borrows Php 2 million, and
15% if it borrows Php 3 million. Which project(s) should the firm
invest in?
a. Project A, because it offers the highest rate of return and is the
only investment that has a rate of return higher than 15%
b. All three (3) projects should be undertaken, because the rate of
return on B is above 6%, on C is above 10%, and on A is above
15%.
c. Projects A and C should be undertaken because both have
rates of return that are greater than 10%.
d. None of the above
5. Consider the following data on a proposed investment:
Investment required Php160,000
Annual cash inflows Php40,000
Life of the investment 6 years
Salvage value 0
Discount rate 10%
Based on the above data, what is the payback period of the
proposed investment project?
a. 2 years c. 4 years
b. 3 years d. 5 years

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REFLECTIVE LEARNING

Investing Biblically

Will you consult the Bible before you invest in a project? Following are the
three (3) Bible verses that will help you to become wise stewards of the money
God has placed in your hands.
Corinthians 10:31 says “So whether you eat or drink, or whatever you do,
do it all for the glory of God.”
Proverbs 16:8 says, “Better is a little with righteous than great revenues
with injustice.”
Ephesians 5:11 says, “Take no part in the unfruitful works of darkness, but
instead expose them.”
Questions to ponder: How will you apply those Bible verses on business
project are you going to undertake? Is there a lesson for you from the three (3)
Bible verses?
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Source:https://www.inspireinvesting.com/2018/03/09/5-bible-verses-for-christian-
investors/

E-SITES
To further explore the concept learned today and if it possible to
connect the internet, you may visit the following links:
https://www.youtube.com/watch?v=Sff3DxOHjJs
https://www.youtube.com/watch?v=YX4NoZN8YWU
https://www.youtube.com/watch?v=HFFkFMfotT0
https://www.youtube.com/watch?v=flfV2fIGeag

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 Learning Module for Business Finance
REFERENCES

ACCA. (2020). Analyzing the suitability of financing alternatives. Retrieved

on July 25, 2020 from
https://www.accaglobal.com/pk/en/student/exam-support-
resources/fundamentals-exams-study-resources/f9/technical-
articles/suitability-financing-alternatives.html
Brealey, R., Myers, S., & Marcus, A. (2004). Fundamentals of corporate
finance. Boston, Mass.: McGraw-Hill Irwin.
Cayanan, A. & Borja (forthcoming). Business Finance. Quezon City. Rex
Bookstore.
Gitman, L. J. & Zutter C. J. (2012). Principles of Managerial Finance (13th
Ed), USA: Prentice-Hall
Gitman, L. (2009). Principles of managerial finance. Boston: Pearson
Prentice Hall.
Teaching Guide for Senior High School Business Finance. (2016). Published
by the Commission on Higher Education.
<http://sciencenetlinks.com/lessons/cells-2-the-cell-as-a- system/>

Acknowledgement

Development Team of the Module

Writers: Edna B. Waje, DEM

Estela Marie C. Reyes, MBA
Editor: Isabel A. Gumaru, DBA
Evaluator: Ellaine I. Dela Cruz, DBA
Validators & Reviewers:
Remylinda T. Soriano, EPS, Math
Angelita Z. Modesto, PSDS
George B. Borromeo, PSDS
Management Team:
Maria Magdalena M. Lim, Schools Division
Superintendent - Manila
Aida H. Rondilla, Chief Education Supervisor
Lucky S. Carpio, EPS, In-Charge of LRMDS
Lady Hannah C. Gillo, Librarian II - LRMS

Page 22 of 22
 ANSWER KEY

PRE-TEST POSTTEST

Multiple Choice 1. B
1. A 2. D
2. D 3. B
3. D 4. C
4. A 5. C
5. D
REFLECTIVE LEARNING
LOOKING BACK TO YOUR LESSON SHEET
1. B Answers may vary depending on
2. D the opinions or views of the
3. D learners.
4. C
5. B
TAKE THE CHALLENGE
Activity 1
1. FALSE
2. TRUE
3. TRUE
4. FALSE
5. FALSE

Activity 2

1. E
2. D
3. C
4. B
5. A

CHECK YOUR UNDERSTANDING

1. D
2. A
3. C
4. B
5. A