me: CALAPE, JAID MARK J. C&Y: BSEE, 2ND yr. Date: Oct.

30, 2021
Score: /25 = %

Andres Bonifacio College, College Park, Dipolog City

ES 225 - Engineering Economics
Midterm – Q3

Instruction: Identify the statements, solve the problems and fill up the answer space provided. Solution
not required. Use the template, do not revise or change. Use PDF apps. only for the answer
template and answer must be gadget generated, hand manual will be invalid.

1. The simplest type of business organization, wherein the business is owned entirely by one person. All
profits obtained from the business are his alone, but he must also bear all losses should they be incurred.
Ans.; Sole proprietorship

2. A business type composed of an association of two or more persons for the purpose of engaging in a
business for profit. Ans.; Partnership

3. A business type of distinct legal entity, separate from the individuals who owned it, and which can
engage in practically any business transaction which a real person could do, considered the most
important type of business. Ans.; Corporation

4. A certificate of indebtedness of a corporation usually for a period not less than 10 years, and
guaranteed by a mortgage on certain s of the association. Ans.; Bond

5. A bond whose owner’s name is recorded in the books of the corporation. Ans.; Registered bond

6. These are bonds whose security is a mortgage on certain specified assets of the corporation. If the
corporation fails to pay the bond value at the date of maturity, title to the property will be transferred to
the bond holders, who may take possession and sale the same to reimburse the amounts they have
invested. Ans.; Mortgage bond

7. These are bonds to which are attached coupons indicating the interest due and the date when such
interest is to be paid. Ans.; Coupon bond

8. 5pts. A total of 50 bonds is issued by a corporation at ₱ 1,000 face value each. The bonds are to be
redeem by the corporation after 15 years. A fund is established by means of an ordinary annuity for
redemption, the interest rate being 4 % compounded annually. Find the annual deposit for this fund.
Ans.; 2,497.06 PHP

9. 6pts. A certificate is offered with a face value of ₱ 100,000 @ 6% annually payable semi-annually for 6
years. If target interest is 8 % semi-annually, what amount must be invested for the certificate?
Ans.; 90,614.93 PHP

10. 7pts. A total of 50 bonds is issued by a corporation at ₱ 1,000 face value each. The bonds are to be
redeem by the corporation after 15 years. A fund is established by means of an ordinary annuity for
redemption, the interest rate being 4 % compounded annually. Find the principal in the fund after 10
years. Ans.; 29979.96985 PHP

Instructor: DC BASADRE, LCE

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Instructor: DC BASADRE, LCE
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