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    Em5 Quiz2 Setb

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    Ely Galeria

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    © All Rights Reserved
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    Em5 Quiz2 Setb

    Uploaded by

    Ely Galeria
    2 views3 pages

    Original Title

    EM5-QUIZ2-SETB

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    © © All Rights Reserved

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    Copyright:

    © All Rights Reserved
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    Download as pdf or txt
    2 views3 pages

    Em5 Quiz2 Setb

    Uploaded by

    Ely Galeria

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    QUIZ #2 ENGINEERING ECONOMICS

    NAME: ______________________________________________ DATE: _________________

    COURSE/SECTION: __________________________________ SCORE: ________________

    I. MULTIPLE CHOICE
    INSTRUCTION: READ THE QUESTIONS CAREFULLY AND ENCIRCLE THE LETTER OF THE CORRECT ANSWER
    1. It is a series of equal cash flows occurring each period over a range of periods.
    a. Annuity b. Continuous Compounding c. Compounding period d. Ordinary Annuity

    2. In the formula of Future Amount (F), the quantity (1 + 𝑖)𝑛 with notation (F/P, i% ,n) is called?
    a. single-payment compound amount factor b. single-payment present worth amount factor c. Equal-Payment Factors

    3. It is known as Annual Effective Rate considering the effect of any compounding during the year.
    a. Simple Interest b. Effective Rate c. Interest Rate d. Nominal Rate

    4. An annuity where equal payments are made at the end of each compounding period starting from the first compounding period.
    a. Annuity Due b. Ordinary Annuity c. Annuity Certain d. Annuity Uncertain

    5. Which of the following has the greatest effective rate?


    a. 12.31 % compounded quarterly b. 12.20 % compounded monthly c. 12.35 % compounded annually d. 12.32 % compounded semi-annually

    II. PROBLEM SOLVING


    INSTRUCTION: SOLVE THE FOLLOWING PROBLEMS AND EXPRESS YOUR FINAL ANSWERS TO TWO DECIMAL PLACES.
    STRICTLY NO ERASURES AND BOX YOUR FINAL ANSWERS. PLEASE WRITE YOUR SOLUTIONS AND FINAL ANSWERS ON SHORT
    BOND PAPER (8.5" X 11"). ENSURE YOUR ANSWERS ARE NEAT, IN ORDER, AND LEGIBLE.

    1. How many years will it take an investment to triple if the interest rate is 8% compounded monthly?

    2. What present sum is equivalent to a series of ₱1000 annual end--year payments, if a total of 20 payments are made and interest
    rate is 12% annually?

    3. The amount of ₱1,500 was deposited in a bank account 20 years ago. Today it is worth ₱3,000. Interest is paid semi-annually.
    Determine the interest rate paid on his account.

    4. ₱1,000,000 was invested to an account earning 8% compounded continuously. What is the amount after 20 years?

    5. A student plans to deposit ₱1,500 in a bank now and another ₱3,000 for the next two years. If he plans to withdraw ₱5,000
    three years after his second deposit for the purpose of buying shoes. What will be the amount of money left in the bank one
    year after his withdrawal? Effective rate is 10%. Draw the cashflow diagram.

    6. A man borrowed ₱300,000 from a lending institution which will be paid after 10 years. If money is worth 8% per annum, how
    much should he deposit to a bank monthly in order to discharge his debt 10 year hence?

    7. What nominal rate compounded semi–annually yields the same amount of 16% compounded quarterly.

    8. By the condition of a will, the sum of ₱20,000 is left to a girl to be held in trust fund by her guardian until it amounts to ₱50,000.
    When will the girl receive the money (in years) if the fund is invested at 8% compounded quarterly?

    9. A debt of ₱10,000 with 10% interest compounded semi-annually is to be amortized by semi-annual payments over the next 5
    years. The first due is 6 months. Determine the semi-annual payments. Draw the cashflow diagram.

    10. What is the present worth of ₱27,000 due in 6 years if money is worth 13% and is compounded semi-annually?

    ADDITIONAL POINTS.
    1. An investment of ₱480 is made at the beginning of each six months for 12 years and 6 months. What is the amount of the
    investment at the end of the term, if interest rate is 3.5% compounded semi-annually?

    2. Guess my bias in BTS.

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