1. A principal of $120 is deposited in a 7% 5.

Find the Simple Interest when the

account and compounded continuously. At Principal is Rs.10000 Rate is 10% and Time
the same time a principal of $150 is is 2years and 4months?
deposited in a 5% account and
Ans. 2333.33
compounded annually. How long does it
take for the amounts in the two accounts to 6. What is the Simple Interest whose
be equal? Principal is Rs.10000 and its Rate of interest
for 5 years is separated as for First 2
Ans. 10.5 years
year=10% next year=20% and last 2
2. A person deposited $1,000 in a 2% years=25%?
account compounded continuously. In a
Ans. 9000
second account, he deposited $500 in a 8%
account compounded continuously. When 7. A man invests Principal of Rs.10000 for 2
will the total amounts in both accounts be years. What is the change in SI when rate of
equal? When will the total amount in the interest changes from 10% to 15%?
second accounts be 50% more than the
Ans. 1000
total amount in the second account?
8. A sum becomes 5 times in 20 years at SI.
Ans. n= 11.55 years
Find the rate of interest?
n= 18.5 years
Ans. 20%
3. A bank saving account offers 4%
9. If a sum is invested by A at 20% per
compounded on a quarterly basis. A
annum for 2years, B at 10% per annum for 3
customer deposit $200, in this type of
years and C at 5% per annum for 4years.If SI
account, at the start of each quarter
received from all of three persons are
starting with the first deposit on the first of
equal. Find the ratio A, B, C?
January and the fourth deposit on the first
of October. What is the total amount in his Ans. 3:4:6
account at the end of the year?
10. A sum of Rs.20000 is distributed in 2
Ans. total= 820.2 schemes namely A at 10%per annum and B
at 15% per annum at the end of 2 years he
4. An amount of $1,500 is invested for 5
gets Rs.5200. What is the amount invested
years at the rates of 2% for the first two
in scheme B?
years, 5% for the third year and 6% for the
fourth and fifth years all compounded Ans. x= 8000
continuously. What is the total amount at
20000-x= 12000
the end of the 5 years?
Ans. 1850.51
1. A loan of P2, 000 is made for a period of
13 months, from January 1 to January 31
the following year, at a simple interest of
20%. What is the future amount is due at
the end of the loan period?
Ans. 2433.33
2. If you borrow money from your friend
with simple interest of 12%, find the
present worth of P20, 000, which is due at
the end of nine months.
7. Jones Corporation borrowed P9, 000
from Brown Corporation on Jan. 1, 1978
and P12, 000 on Jan. 1, 1980. Jones
Corporation made a partial payment of P7,
000 on Jan. 1, 1981. It was agreed that the
balance of the loan would be amortizes by
two payments one of Jan. 1, 1982 and the
other on Jan. 1, 1983, the second being
50%larger than the first. If the interest rate
is 12%. What is the amount of each
payment?

Ans. 18348.62 Ans. x= 9137.18

3. Determine the exact simple interest on 3/2x= 13705.77

P5, 000 for the period from Jan.15 to
8. A woman borrowed P3, 000 to be paid
Nov.28, 1992, if the rate of interest is 22%.
after years with interest at 12%
Ans. 955.74 compounded semiannually and P5, 000 to
be paid after 3 years at 12% compounded
4. A man wishes his son to receive P200,
monthly. What single payment must she
000 ten years from now. What amount
pay after years at an interest rate of 16%
should he invest if it will earn interest of
compounded quarterly to settle the two
10% compounded annually during the first
obligations?
5 years and 12% compounded quarterly
during the next 5 years? Ans. 12627.56

Ans. 68757.82
5. By the condition of a will the sum of P25,
000 is left to be held in trust by her
guardian until it amounts to P45, 000.
When will the girl receive the money if the
fund is invested at 8% compounded
quarterly?
Ans. 7.42 yrs
6. At a certain interest rate compounded
semiannually P5, 000 will amount to P20,
000 after 10 years. What is the amount at
the end of 15 years?
Ans. 39973.74
1. It is the practice of almost all banks in the 6. If money is invested at 8% compounded
Philippines that when they grant loan, the semi-annually, find equivalent nominal rate
interest for one year is automatically compounded quarterly.
deducted from the principal amount upon
Ans. 7.92%
the release of the money to a borrower. Let
us assume that you applied for a loan with
the bank and the P100,000 was approved at
an interest rate of 12% of which P12,000
was deducted and you were given a check
of P88,000. Since you have to pay the
amount of P100,000 one year after, what
then will be the effective interest rate?
Ans. 13.64%
2. A man invests $10,000 in an account that
pays 8.5% interest per year, compounded
quarterly. What is the amount of money
that he will have after 3 years?
Ans. 12870.19
3. sum of $5000 is invested at an interest
rate of 9% per year. Find the time required
for the money to double if the interest is
compounded semi-annually.
Ans. 7.87 or 8 years
4. man invests $10,000 in an account that
pays 8.5% interest per year. What is the
amount of money that he will have after 3
years if it is compounded continuously?
Ans. 12904.62
5. Find the effective rate of interest for an
investment that earns 5 ½ % per year (a)
compounded quarterly, (b) compounded
continuously.
Ans. a. 5.61%
b. 5.65%
1. Jay wishes his son, jayson to receive ans. 10.25%
1000000 twenty years from now. What
b. Nominal interest rate of 6% compounded
amount should he invest now, if it will earn
monthly ans. 6.17%
interest of 12% compounded annually
during the first 5 years and 10% c. Nominal interest rate of 8% compounded
compounded monthly for the remaining quarterly
years.
ans. 8.24%
Ans. P= 224 521.34;
7. If 1000 becomes 5734 after 15 years,
P = 127 399.44 when invested at an unknown rate of
interest compounded semi-annually,
2. Find the present worth of a future
determine the unknown nominal rate and
payment of 300000 to be made in 10 years
corresponding effective rate.
with an interest rate of 10% compounded
annually. What will be the amount if it will Ans. r=12% I=12.36%
be paid on the 15th year?
8. A machine worth P50,000 is expected to
Ans. 115 662.99; 483 153.01 last for 3 years. During its operation, a
maintenance cost of P1,000 is needed after
3. A loan of 50,000 is made for a period of
the 1st year of operation and P2,000 at the
13 months from April 1 to April 30 of the
end of the 2nd year. What present amount
following year, a t a simple interest rate of
is required to operate the machine, if
20%. What future amount is due at the end
money is worth 16% compounded
of the loan period?
quarterly?
Ans. 60, 833.33
Ans. P52, 316.18
4. What is the principal amount if the
amount of interest at the end of 2 ½ year is
450 for a simple interest rate of 6% per
annum?
Ans. 3000
5. Determine the exact simple interest of
25000 for the period from Dec 27, 2001 to
March 23, 2003, if the rate of interest is
10%?
Ans. 3095.89
6. What effective annual interest rate
corresponds to the following situations: a.
Nominal interest rate of 10% compounded
semi-annually