Set 27
Problem 1
Find the interest on P6800.00 for 3 years at 11% simple interest.
A. P1,875.00 C.
P2,144.00
B. P1,987.00 D.
P2,244.00 Problem 2
A man borrowed P10,000.00 from his friend and agrees to pay at the end of 90 days under 8% simple interest rate. What is the required amount?
A. P10,200.00 C.
P9,500.00
B. P11,500.00 D.
P10,700.00 Problem 3 (EE Board)
Annie buys a television set from a merchant who offers P 25,000.00 at the end of 60 days. Annie wishes to pay immediately and the merchant offers to compute the required amount on the assumption that money is worth 14% simple interest. What is the required amount?
A. P20,234.87 C.
P24,429.97
B. P19,222.67 D.
P28,456.23 Problem 4
What is the principal amount if the amount of interest at the end of 2½ year is P4500 for a simple interest of 6% per annum?
A. P35,000.00 C.
P40,000.00
B. P30,000.00 D.
P45,000.00
Problem 5
How long must a P40,000.00 not bearing 4% simple interest run to amount to P41,350.00?
A. 340 days C. 304
days
B. 403 days D. 430
days Problem 6
If P16,000 earns P480 in 9 months, what is the annual rate of interest?
A. 1% C. 3%
B. 2% D. 4%
Problem 7 (CE May 1997)
A time deposit of P110,000 for 31 days earns P890.39 on maturity date after deducting the 20% withholding tax on interest income. Find the rate of interest per annum.
A. 12.5% C.
12.25%
B. 11.95% D.
11.75%
Problem 8 (ME April 1998)
A bank charges 12% simple interest on a P300.00 loan. How much will be repaid if the load is paid back in one lump sum after three years?
A. P408.00 C.
P415.00
B. P551.00 D.
P450.00
Problem 9 (CE May 1999)
The tag price of a certain commodity is for 100 days. If paid in 31 days, there is a 3%
discount. What is the simple interest paid?
A. 12.15% C.
22.32%
B. 6.25% D.
16.14%
Problem 10
Accumulate P5,000.00 for 10 years at 8%
compounded quarterly.
A. P12,456.20 C.
P10,345.80
B. P13,876.50 D.
P11,040.20 Problem 11
Accumulate P5,000.00 for 10 years at 8%
compounded semi-annually.
A. P10,955.62 C.
P9,455.67
B. P10,233.67 D.
P11,876.34 Problem 12
Accumulate P5,000.00 for 10 years at 8%
compounded monthly.
A. P15,456.75 C.
P14,768.34
B. P11,102.61 D.
P12,867.34 Problem 13
Accumulate P5,000.00 for 10 years at 8%
compounded annually.
A. P10,794.62 C.
P10,987.90
B. P8,567.98 D.
P7,876.87
Problem 14
How long will it take P1,000 to amount to P1,346 if invested at 6% compounded quarterly?
A. 3 years C. 5
years
B. 4 years D. 6
years Problem 15
How long will it take for an investment to double its amount if invested at an interest rate of 6% compounded bi-monthly?
A. 10 years C. 13
years
B. 12 years D. 14
years Problem 16
If the compound interest on P3,000.00 in 2 years is P500.00, then the compound interest on P3,000.00 in 4 years is:
A. P956.00 C.
P1,125.00
B. P1,083.00 D.
P1,526.00 Problem 17
The salary of Mr. Cruz is increased by 30%
every 2 years beginning January 1, 1982.
Counting from that date, at what year will his salary just exceed twice his original salary?
A. 1988 C.
1990
B. 1989 D.
1991
Problem 18
If you borrowed P10,000.00 from a bank with 18% interest per annum, what is the total amount to be repaid at the end of one year?
A. P11,800.00 C.
P28,000.00
B. P19,000.00 D.
P10,180.00 Problem 19
What is the effective rate for an interest rate of 12% compounded continuously?
A. 12.01% C.
12.42%
B. 12.89% D.
12.75%
Problem 20
How long will it take for an investment to fivefold its amount if money is worth 14%
compounded semi-annually?
A. 11 C. 13
B. 12 D. 14
Problem 21
An interest rate of 8% compounded semiannually is how many percent if compounded quarterly?
A. 7.81% C.
7.92%
B. 7.85% D.
8.01%
Problem 22
A man is expecting to receive P450,000.00 at the end of 7 years. If money is worth 14%
compounded quarterly, how much is it worth at present?
A. P125,458.36 C.
P162,455.63
B. P147,456.36 D.
P171,744.44 Problem 23
A man has a will of P650,000.00 from his father. If his father deposited an account of P450,000.00 in a trust fund earning 8%
compounded annually, after how many years will the man receive his will?
A. 4.55 years C. 5.11
years
B. 4.77 years D. 5.33
years Problem 24
Mr. Adam deposited P120,000.00 in a bank who offers 8% interest compounded
quarterly. If the interest is subject to a 14%
tax, how much will he receive after 5 years?
A. P178,313.69 C.
P170,149.77
B. P153,349.77 D.
P175,343.77 Problem 25
What interest compounded monthly is equivalent to an interest rate of 14%
compounded quarterly?
A. 1.15% C.
10.03%
B. 13.84% D.
11.52%
Problem 26 (ME April 1996)
What is the present worth of two P100.00 payments at the end of the third and the fourth year? The annual interest rate is 8%.
A. P152.87 C.
P187.98
B. P112.34 D.
P176.67
Problem 27 (ME April 1996)
Consider a deposit of P600.00, to be paid up in one year by P700.00. What are the
conditions on the rate of interest, i% per year compounded annually, such that the net present worth of the investment is positive?
Assume i 0.
A. i 16.7% C.
12.5% i 14.3%
B. i 14.3% D.
16.7% i 100%
Problem 28 (ME April 1996)
A firm borrows P2000.00 for 6 years at 8%.
At the end of 6 years, it renews the loan for the amount due plus P2000 more for 2 years at 8%. What is the lump sum due?
A. P5,679.67 C.
P6,034.66
B. P6,789.98 D.
P5,888.77 Problem 29
At an annual rate of return of 8%, what is the future worth of P1000 at the end of 4 years?
A. P1388.90 C.
P1765.56
B. P1234.56 D.
P1360.50
Problem 30 (ME October 1997) A student has money given by his
grandfather in the amount of P20,000.00.
How much money in the form of interest will he get if the money is put in a bank that offers 8% rate compounded annually, at the end of 7 years?
A. P34,276.48 C.
P36,279.40
B. P34,270.00 D.
P34,266.68
Problem 31 (ME October 1997)
If the interest rate on an account is 11.5%
compounded yearly, approximately how many years will it take to triple the amount?
A. 11 years C. 9
years
B. 10 years D. 12
years
Problem 32 (ME October 1997)
The nominal interest rate is 4%. How much is my P10,000.00 worth in 10 years in a continuously compounded account?
A. P13,620.10 C.
P14,918.25
B. P13,650.20 C.
P13,498.60
Problem 33 (ME October 1997)
How much must be invested on January 1, year 1, in order to accumulate P2,000.00 on January 1, year 6 at 6%.
A. P1,295.00 C.
P1,495.00
B. P1,695.00 D.
P1,595.00
Problem 34 (ME April 1998)
If P5000.00 shall accumulate for 10 years at 8% compounded quarterly. Find the
compounded interest at the end of 10 years.
A. P6,005.30 C.
P6,000.00
B. P6,040.20 D.
P6,010.20
Problem 35 (ME April 1998)
A sum of P1,000.00 is invested now and left for eight years, at which time the principal is withdrawn. The interest that has accrued is left for another eight years. If the effective annual interest rate is 5%, what will be the withdrawal amount at the end of the 16th year?
A. P706.00 C.
P500.00
B. P774.00 D.
P799.00
Problem 36 (ME April 1998)
It is the practice of almost all banks in the Philippines that when they grant a loan, the interest for one year is automatically deducted from the principal amount upon release of money to a borrower. Let us therefore assume that you applied for a loan with a bank and the P80,000.00 was
approved at an interest rate of 14% of which P11,200.00 was deducted and you were given a check of P68,800.00. Since you have to pay the amount of P80,000.00 one year after, what then will be the effective interest rate?
A. 15.90% C.
16.28%
B. 16.30% D.
16.20%
Problem 37 (ME April 1998)
The amount of P1,500.00 was deposited in a bank account offers a future worth
P3,000.00. Interest is paid semi-annually.
Determine the interest rate paid on this account.
A. 3.5% C. 2.9
B. 2.5% D. 4%
Problem 38 (ME April 1998)
A merchant puts in his P2,000.00 to a small business for a period of six years. With a given interest rate on the investment of 15%
per year, compounded annually, how much will he collect at the end of the sixth year?
A. P4,400.00 C.
P4,390.00
B. P4,200.00 D.
P4,626.00 Problem 39
A person invests P4500 to be collected in 8 years. Given that the interest rate on the investment is 14.5% per year compounded annually, what sum will be collected in 8 years?
A. P13,678.04 C.
P14,888.05
B. P13,294.02 D.
P14,234.03
Problem 40
The following schedule of funds is available to form a sinking fund.
current year (n) 50,000.00
n+1 40,000.00
n+2 30,000.00
n+3 20,000.00
At the end of the fourth year, equipment costing P250,000.00 will have to be purchased as a replacement for old
equipment. Money is valued at 20% by the company. At the time of purchase, how much money will be needed to supplement the sinking fund?
A. P12,000.00 C.
P10,000.00
B. P11,000.00 D.
P9,000.00
Problem 41 (ME October 1995) In year zero, you invest P10,000.00 in a 15% security for 5 years. During that time, the average annual inflation is 6%. How much, in terms of year zero pesos, will be in the account at the maturity?
A. P15,386.00 C.
P13,382.00
B. P15,030.00 D.
P6,653.00
Problem 42 (ME October 1995) A company invests P10,000 today to be repaid in five years in one lump sum at 12%
compounded annually. If the rate of inflation is 3% compounded annually, how much
profit in present day pesos is realized over five years?
A. P5,626.00 C.
P3,202.00
B. P7,623.00 D.
P5,202.00
Problem 43
Compute the effective rate for an interest rate of 16% compounded annually.
A. 16% C.
16.98%
B. 16.64% D.
17.03%
Problem 44
Compute the effective rate for an interest rate of 16% compounded quarterly.
A. 16% C.
16.98%
B. 16.64% D.
17.03%
Problem 45
Convert 12% compounded semi-annually to x% compounded quarterly.
A. 11.83% C.
11.23%
B. 11.71% D.
11.12%
Problem 46
Convert 12% compounded semi-annually to x% compounded monthly.
A. 11.83% C.
11.23%
B. 11.71% D.
11.12%
Problem 47 (ME October 1995)
A bank is advertising 9.5% accounts that yield 9.84% annually. How often is the interest compounded?
A. daily C.
bi-monthly
B. monthly D.
quarterly
Problem 48 (ECE November 1995, November 1998)
By the conditions of a will, the sum of P25,000 is left to a girl to be held in a trust fund by her guardian until it amount to P45,000. When will the girl receive the money if the fund is invested at 8%
compounded quarterly?
A. 7.42 years C. 7
years
B. 7.25 years D. 6.8
years
Problem 49 (ECE April 1995)
A man expects to receive P20,000 in 10 years. How much is that money worth now considering interest at 6% compounded quarterly?
A. P11,025.25 C.
P15,678.45
B. P17,567.95 D.
P12,698.65
Problem 50 (ECE March 1996)
What is the effective rate corresponding to 16% compounded daily? Take 1 year = 360 days.
A. 16.5% C.
17.35%
B. 16.78% D.
17.84%
Problem 51
What amount will be accumulated by a present investment of P17,200 in 6 years at 2% compounded quarterly?
A. P19,387.15 C.
P19,856.40
B. P20,456.30 D.
P19,232.30 Problem 52
What rate of interest compounded annually must be received if an investment of
P54,000 made now with result in a receipt of P72,000 5 years hence?
A. 5.12% C.
5.92%
B. 5.65% D.
5.34%
Problem 53
With interest at 6% compounded annually, how much is required 7 years hence to repay an P8 M loan made today?
A. P12,456,789 C.
P12,029,042
B. P12,345,046 D.
P12,567,000 Problem 54
If money is worth 6% compounded
annually, what payment 12 years from now is equivalent to a payment of P7000 9 years from now?
A. P8765.10 C.
P8337.10
B. P8945.20 D.
P8234.60
Problem 55
If money is worth 6% compounded annually, how much can be loaned now if P6000 will be repaid at the end of 8 years?
A. P3567.30 C.
P3456.34
B. P3444.44 D.
P3764.50
Problem 56
A person invests P4500 to be collected in 8 years. Given that the interest rate on the investment is 14.5% per year, compounded annually, what sum, in pesos, will be collected eight years hence?
A. P4504 C.
P13294
B. P9720 D.
P10140
Problem 57 (CE November 1996)
If P500,000 is deposited at a rate of 11.25%
compounded monthly, determine the compounded interest after 7 years and 9 months.
A. P660,592 C.
P680,686
B. P670,258 D.
P690,849
Problem 58 (CE May 1996)
P200,000 was deposited on Jan. 1, 1988 at an interest rate of 24% compounded
semi-annually. How much would the sum on Jan.
1, 1993?
A. P421,170 C.
P401,170
B. P521,170 D.
P621,170