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ESci131n
Engineering Economy
Assignment 9
Coverage: Annuity Due
Deadline: 6pm, Thursday, 03 June 2021

Class Number 12
Class Schedule 3-4:30 MW
Solve the following problems. Present a complete and comprehensive solution following
the traditional format (given, required and solution) using the required units.
Solutions/final answers not using the correct units will not earn points. Truncated or
“short-cut” solutions will not be accepted. Construct the correct cash flow diagram for
every problem. Round off your final answer to two (2) decimal places. Enclose your final
answer with a rectangle otherwise it will not be credited.

1. A father wishes to gift his son P40,000 on his twenty first birthday. How much should the
father deposit at the start of every six months in a savings account which pays 3% semi-
annually if his first deposit is made when his son is still three and a half years old? However,
instead of depositing repeatedly at the start of every six months until his son becomes twenty-
one years old, he would just simply make a single deposit when his son is still three and a half
years old. How much would this single deposit be? (3pts)
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2. Under a company’s forced savings plan, each employee is required to deposit P1,000 at the
beginning of each month for five years. If the management guarantees the savings plan to grow
at 6% compounded monthly, how much will each employee expect to receive after five years?
(3pts)