1.

What will be the maturity value of ₱12,000 invested for four (4) years at 15%

Compounded quarterly?

Given:

P = 12,000

J = 15% or 0.15

M= 4

T= 4 years

N = tm = 4 (4) = 16

I = j/m = 0.15/4 = 0.0375

Answer:
F= P (1 + I )n

F = 12,000 ( 1 + 0.0375) 20

F = 12, 000 ( 1.0375) 20

F = 12, 000 (1.802227807)

F = 21, 626.73 will be the maturity value.

2. Determine the maturity value of ₱3,000 invested at 9.5% compounded

Semiannually for 3 ½ years.

Given:

P = 3,000

J = 9.5% or 0.095

M= 2

T= 3 ½ years = 3.5

N = tm = 4 (4) = 16
I = j/m = 0.15/4 = 0.0375
Answer:
F= P (1 + I )n

F = 12,000 ( 1 + 0.0375) 20

F = 12, 000 ( 1.0375) 20

F = 12, 000 (1.802227807)

F = 21, 626.73 will be the maturity value.

3. What amount must be invested now in savings account earnings 9%

Compounded quarterly to accumulate a total of ₱21,000 after 4 ¾ years?

Given:

J = 9% or 0.09

M= 4

F = 21,000

T= 4 ¾ years = 4.75

N = tm = 4.75 (4) = 19

I = j/m = 0.09/4 = 0.0225

Answer:
P = F/ (1 + I ) n

P = 21, 000 / (1 + 0.0225)19

P = 21, 000 / (1.0225)19

P = 21, 000/1.526170367

P = 13, 759. 93169

P = 13, 759. 93 is the amount that must Be invested.

4. Millet wants to provide a ₱200,000 graduation gift for her daughter Mae who
Is now 16 years old. She would like the fund to be available by the time her

Daughter is 20. She decides on an investment that pays 10% compounded

Quarterly. How large must the deposit be?

Given:

F = 200,000

J = 10% or 0.10

M=4

T= 4 years

N = tm = 4 (4) = 16

I = j/m = 0.10/4 = 0.025

Answer:
P = F/ (1 + I ) -n

P = 200, 000 / (1 + 0.025)-16

P = 200, 000 / (1.025)-16

P = 200, 000/0.6736249335

P = 134, 724. 99 shall be the deposit.

5. Ms. Cruz can buy a piece of property for ₱6,500,000 cash or ₱4,000,000

Down payment and

₱4,200,000 in five (5) years. If she has money earning 8% converted

Quarterly, which is a better purchased plan and by how much?

P = 2, 500, 000

J = 8 % X 4 = 32% Or 0.32

M= 4
Answer:
F= P (1 + I )n

F = 2, 500, 000 ( 1 + 0.08) 20

F = 2, 500, 000 ( 1.08) 20

F = 2, 500, 000 (4.660957144)

T = 5 years

N = tm = 5 (4) = 20

I = j/m = 0.32/4 = 0.08

First Option = ₱6,500,000

Second Option = or ₱4,000,000

Down payment and

₱4,200,000 in five (5) years