Write your answer on a separate sheet of paper.

The Business Partners

By Aya

Two brothers are planning to establish a café restaurant. Bien is fond of coffee

While Bryan is fond of pastries. Both have contributed part of their savings but upon

The assessment of the values, they need more capital. The amount needed is

Php 500,000.00, and they decided to divide it equally.

Bien plans to get a policy loan of Php 100,000.00 from his life insurance and

Apply from a microfinance for the remaining. The requirement for both policy loan

And microfinance is an application form and agreement form. The effect on the policy

Loan is that it will reduce the amount of Bien’s life insurance with the principal and

Interest. On the other hand, the microfinance has 3.5% interest rate per month

Payable for 5 years.

Bryan has a 5-year real estate property costing Php 350,000.00 at par. He

Plans to take a loan of Php 500,000.00 from a bank, giving the title of his land as
Collateral. The bank has an interest rate of 9% per annum, payable for 10 years.

Questions:

1. Is Bien’s loan application a wise decision? Why or why not?

2. Is Bryan’s loan application a wise decision? Why or why not?

3. What can you suggest or advice the brothers about their loan plans? Explain

Your answer.

Scoring Rubrics:

9-10 pts

The idea is well explained and analyzed with factual basis or

Supporting computation.

6-8 pts

The idea is explained and analyzed but without factual basis or

Supporting computation.

3-5 pts
The idea is explained and analyzed ambiguously but is

Acceptable.

1-2 pts

The idea is not accurately analyzed, and the explanation is far

From the concept or main idea.