Malayan Colleges Mindanao

General Mathematics
Performance Check

DEFERRED ANNUITY
Instruction: Solve the given situations. Show your solutions (5 points each).
1. Emma availed of a cash loan that gave her an option to pay P10,000 monthly for
1 year. The first payment is due after 6 months. How much is the present value of
the loan if the interest rate is 12% compounded monthly? Answer: P107,088.20

2. Adrian purchased a laptop through the credit cooperative of their company. The
cooperative provides an option for a deferred payment. Adrian decided to pay after
4 months of purchase. His monthly payment is computed as P3,500 payable in 12
months. How much is the cash value of the laptop if the interest rate is 8%
compounded monthly? Answer: P39,441.14

3. Mr. and Mrs. Mercado decided to sell their house and to deposit the fund in a bank.
After computing the interest, they found out that they may withdraw P350,000
yearly for 4 years starting at the end of 7 years when their child will be in college.
How much is the fund deposited if the interest rate is 3% compounded annually?
Answer: P1,089,533.99

4. A group of employees decided to invest a portion of their bonus. After 3 months

from today, they want to withdraw from this fund P5,000 monthly for 12 months to
fund their gathering that they decide to do every month. How much is the total
deposit now if the interest rate is 5% compounded monthly? Answer: P57,922.41

5. Anna converted her loan to light payments which gives her an option to pay P1,500
every month for 2 years. The first payment is due 3 months from now. How much
is the amount of the loan if the interest rate is 9% compounded monthly? Answer:
P32,346.70