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    This document contains 10 word problems related to compound interest calculations. The questions cover topics such as determining lump sum deposits needed to withdraw specified amounts in the future, calculating annual payment amounts on loans with compound interest, calculating interest rates based on future values, determining time periods for investments/loans, and calculating present values. Multiple choice answers are provided for each question.

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    Annuity Due

    Uploaded by

    Jsbebe jskdbsj
    2K views2 pages
    This document contains 10 word problems related to compound interest calculations. The questions cover topics such as determining lump sum deposits needed to withdraw specified amounts in the future, calculating annual payment amounts on loans with compound interest, calculating interest rates based on future values, determining time periods for investments/loans, and calculating present values. Multiple choice answers are provided for each question.

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    Good fore students

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    This document contains 10 word problems related to compound interest calculations. The questions cover topics such as determining lump sum deposits needed to withdraw specified amounts in the future, calculating annual payment amounts on loans with compound interest, calculating interest rates based on future values, determining time periods for investments/loans, and calculating present values. Multiple choice answers are provided for each question.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    2K views2 pages

    Annuity Due

    Uploaded by

    Jsbebe jskdbsj
    This document contains 10 word problems related to compound interest calculations. The questions cover topics such as determining lump sum deposits needed to withdraw specified amounts in the future, calculating annual payment amounts on loans with compound interest, calculating interest rates based on future values, determining time periods for investments/loans, and calculating present values. Multiple choice answers are provided for each question.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 2

    1.

    A mother on the day the child is born wishes to determine what lump sum would
    have to be paid into an account bearing interest at 15% compound annually, in
    order to withdraw P29,000 each on the child’s 18th, 19th, 20th and 21st birthday.
    A. P7,693.74 B. P7936.74 C. P7369.47 D. P7693.47

    2. A man borrowed P40,000 and promise to pay the amount annually for 11years,
    at the beginning of each period with interest rate of 15% compounded annually.
    Find the annual amount.
    A. P6,465.9 B. P6,645.9 C. P6,546.8 D. P6,646.9

    3. Mr. Gomez deposit P74,000 and withdraw P10,000 per year at the beginning of
    each period with interest rate of 10%. In how many years will a deposit become
    zero?
    A. 11 yrs. B. 11.72 yrs. C. 12 yrs. D. 13 yrs.

    4. Ms. Villamor, her annual payment was P7,000, becomes P470,123 in 15 years at
    beginning of each. Find the annual interest of the investment.
    A. 15% B. 16.7% C. 17.25% D.18%

    5. A president borrowed P40,000 and promised to pay amount annually for 20


    years at the beginning of each period with interest rate of 17% compounded
    semi-annually. Find the annual amount.
    A. P6,261.39 B. P6,621.93 C. P6,162.39 D. P6,712.93

    6. A local firm is establishing a sinking fund for the purpose of accumulating


    sufficient capital to retire its outstanding bonds at maturity. The bonds are
    redeemable 11 years, and their maturity values P160,000. How much deposited
    each year if the fund pats interest at the rate of 4%.
    A. P10,867.33 B. P11,863.84 C. P12,893.78 D. P11,263.09

    7. How much money must you invest today in order to withdraw 2000/year for 11
    years if the interest rate 10%.
    A. P11,783.98 B. P12,894.94 C. P12,990.12 D. P13,894.87

    8. The president of a growing engineering firm wishes to give each of 60 employees


    a holiday bonus. How much is needed to invest monthly for a year at 11%
    interest rate, compounded monthly, so that each employee will receive a P2,000
    bonus.
    A. P9,754.8 f0r 60employee C. P9,875.9 f0r 60employee
    B. P6,869.9 f0r 60employee D. P9,505.8 f0r 60employee
    9. An employee is about to receive the sum 400 at the end of each year for 5 years.
    One year prior to the receipt of the first sum. He decides to discount all 5 sums. If
    the rate is 7%. What proceeds will he obtain.
    A. P1640.08 B. P1753.78 C. P1712.79 D. P1687.98

    10. A fixture that cost 800 will save P0.07 per item produce. Maintenance will be at
    50 annually. 3600 units are produced annually. What is the payback period at
    11%.
    A. 4.8 years B. 5 years C. 5.48 years D. 5.9 years

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