ENSC 2063

ENGINEERING ECONOMY
ASSIGNMENT NO. 2

1. Find a cash price of a generator which was bought in installment basis that requires a down
payment of P50,000.00 and payment of P30,000.00 after 1 year, P40,000.00 after 2 years
and a final payment of P76,374.34 after 4 years at a rate of 15% per annum.

2. A man made a loan of P100,000.00 at a rate of 15% per annum and promise to pay it
according to the following manner, P30,000.00 at the end of 1 st year, unknown payment at
the end of 2nd year and a final payment of P76,374.38 at the end of 4 th year. Find the
unknown payment made by the man.

3. Find the present worth of the following payments, P5,000.00 after 1 year, P4,000.00 after 2
years, P8,000.00 after 4 years at a rate of 12% per annum.

4. A bank is advertising 9.5% accounts that yield 9.84% annually. How often is the interest
compounded?

5. A man borrows P2,000.00 for 6 years at 8%. At the end of 6 years, he renews the loan for
the amount due plus P2,000.00 more for two years at 8%. What is the lump sum due?

6. What present sum is equivalent to a series of P1,000 annual end-of-year payments, if a total
of 20 payments are made and interest is 12%

7. A man made ten annual-end-of-year purchases of P1,000 common stock. At the end of 10 th
year he sold all the stock for P12,000. What interest rate did he obtain on his investment?

8. A condominium unit can be bought at a downpayment of P150,000 and a monthly payment

of P10,000 for 10 years starting at the end of 5 th year from the date of purchase. If money is
worth 12% compounded monthly, what is the cash price of the condominium unit?

9. A wealthy man donated a certain amount of money to provide scholarship grants to

deserving students. The fund will grant P10,000 per year for the first 10 years and P20,000
per year on the years thereafter. The scholarship grants started one year after the money
was donated. How much was donated by the man if the fund earns 12% interest.

10. A company rent a building for P50,000 per month for a period of 10 years. Find the
accumulated amount of the rentals if the rental for each month is being paid at the start of
each month and money is worth 12% compounded monthly.