ASSIGNMENT/PROBLEM SET #1
1.
In buying a refrigerator, Mr. Alcantara was offered the option of paying P27,500 cash at the end of 30 days or P29,700 at the
end of 120 days. At what rate is Mr. Alcantara paying simple interest if he agrees to pay at the end of 120 days? ANS. 32.88%
2.
P1,000,000.00 was deposited in a bank and left for 8 years, at which time the principal is withdrawn. The interest has accrued
and is left for another 8 years. If the effective annual interest is 5%, what will be the withdrawal amount at the end of the 16th
year? ANS. 705,419.14
3.
Mr. Gomez plans to deposit P525,000.00 in the bank now and another P1,050,000.00 for the next 2 years. If Mr. Gomez plans
to withdraw P1,750,000.00 3 years after his last deposit for the purpose of buying a house and lot, what will be the amount of
money left in the bank after one year of his withdrawal? The effective annual interest rate is 10%. ANS. 542,374.53
4.
Bianca needs P100,000 per year for four years to go to college. His father invested P125,000 in an account earning an interest
of 7% per annum for her education on the day that she was born. If Bianca will withdraw P100,000 at the end of her 17th, 18th,
19th, and 20th birthday, how much money will be left in the account at the end of her 21st birthday? ANS. 42,496.40
5.
Mr. and Mrs. Corpuz borrowed P600,000 from Mabuhay Lending Corp. for 6 years at 12%. At the end of 6 years, it renews the
loan for the amount due plus P600,000 more for 3 years at 12% compounded annually. What is the lump sum due? ANS.
2,506,804.05