Chapter 5 –Mathematics of Finance

Learning Objectives:
 Define the term and concepts in Mathematics and Finance
 Apply the different problems strategies in solving problems in mathematics of finance such as
simple and compound interest
 Differentiate the different kinds of loans.
 Determine which investments are more profitable and less risky
Introduction:

Financial mathematics mainly includes the basic concepts and methods of mathematics, the
related natural science methods and so on. The use of mathematics is to express, reason, and prove the
underlying principles of finance. Financial mathematics is an important branch of finance which is
completely based on the background and foundation of financial theory.
Finance is used as a sub discipline of economics of identity development, though it has a characteristic
enough from the economic independence, but it still requires time, financial mathematics also needs
financial knowledge, tax theory and accounting principles as the background of knowledge.

Mathematics of Finance

Interest – is the amount charged for using borrowed money? It is an expense for the person who
borrows money and income for the person who lends money.
Interest is computed on principal amount at a certain rate for a certain period. For example,
10% annually, 4% per quarter or 2% per month etc.

Principal amount – is the sum of money that is originally borrowed from an individual or a
financial institution. It does not include interest.

Interest is computed using one of two methods. These are:

1. Simple interest method
2. Compound interest method

Simple Interest Method:

Under this method, the interest is computed only on the amount originally lent (principal
amount) to the borrower. Interest is not charged on any accumulated interest under this method. Simple
interest is usually applied on short – term borrowing.

Simple Interest Formula:

Simple interest can be easily computed using the formula

I = Prt
where: I = Simple interest
P = Principal amount
r = rate of interest
t = time

Note: Observe consistency. If the rate is expressed in terms of year, the time should also be expressed in terms of year. Similarly, if

the rate, if the time is expressed in terms of month, the time should also be expressed in terms of month.

Example:

1. At 6 % per annum, how much interest will a savings deposit of P 43,000 earn after 2 years?
Solution:
a. Identify the given and unknown.
Given:
P = 43,000
r = 6% = .06
t = 2 years
Unknown is interest (I)

b. Using the formula I = Prt, substitute the value of P, r and t and then solve the given values in
the working equation.
Hence:
I = 43,000 (.06) (2)
I = P 5,160
Therefore, the interest is P 5,160 .
2. Mina borrowed P 4,000 for three months and paid an interest of P 250. What was the annual rate of
interest?

Given: Unknown: rate annually

P = 4,000
t = 3 months
I = 250

* Since the rate is expressed annually or yearly, the time which is 3 months should be expressed in terms
of year.

3
t= 3 months = 12 year = ¼ year

Using the same formula I = Prt, substitute the given in the problem. After which, solve the equation in
one unknown.

(Note) : The original formula can be manipulated to derived another formula say for instance when P is
I
unknown , P= . Then, use formula to solve for what is asked. Manipulating the formula to find for the
rt
rate, we have;

I
R=
Pt

Substituting the values in the formula;

I
R=
Pt

= 25_
4000(.25)
= 25
1000
= 0.25 or 25% → Therefore the annual rate of interest is 25%

Time Conversion

If the time is in terms of;

a. Months, then devide by 12
b. Semiannual periods, then divide by 2
c. Quarterly period, then divide by 4
d. Bimonthly periods, then devide by 6
e. Semimonthly periods, then divide by 24

If the time is express in days, then there are 2 kinds of time to convert the number of days D in
years.
 a. t = number of days = D , for exact interest
365 365

b. t = number of days = D , for ordinary interest

360 360
The ordinary interest is usually applied in Banker’s Rule

Examples:

a. Convert 0.25 years to months.

Solution:
0.25 (12) = 3 months

b. Convert 2.6 years in terms of (a) Months (b) semiannual periods.

Solution:
Years to months, multiply by 12
1.6 (12) = 31.2 or 31 and 1/5 months

Years to semiannual periods, multiply by 2

2.6 (2) = 5.2 semiannual periods

Compound Interest Method

Under this method, the interest is charged on principal plus accumulated interest. The amount of
interest for a period is added to the amount of principal to compute the interest for next period. In short,
the interest is reinvested to earn more interest. The interest may be compounded monthly, quarterly,
semi-annually or annually.
Consider the example below to understand the procedure of compounding.

Example:
Suppose, Mila has deposited P 1000 in a bank for five years at a rate of 5 % per year
compounded annually. The interest for the first year will be compounded on P 1000 and will become
P 1050. (P 1000 principal + P 50 interest) at the end of first year. The interest for the second year will be
computed on P 1050 and at the end of second year you will have P 1102 ( P 1050 principal + P 52.5
interest ). The interest for the third year will be computed on P 1102.50 and at the end of third year you
will have P 1157.60
( P 1102.5 principal + P 55.1 interest ). The following table shows the computation for 5 – year period of
investment.

Years Principal Rate of Interest Interest Compound

Amount Amount
1 P 1000 5% P 50 P 1050
2 P 1050 5% P 52.50 P 1102.50
3 P1102.50 5% P 57.60 P 1157.60
4 P1157.60 5% P 57.90 P 1215.50
5 P1215.50 5% P 60.80 P 1276.30

Under compound interest system, when interest is added to the principal amount, the resulting
figure is known as compound amount in the above table, the compound amount at the end of each year
has been computed at the last columns. Notice that the compound amount at the end of a year becomes
the principal amount to compute the interest for the next year.

Compound Amount Formula

The above procedure of computing amount is lengthy, tedious and time consuming .Fortunately,
a formula is available to compute compound amount for any number of periods. The formula is:
S= ( P + i ) n
Where :
S= compound amount
P= Principal amount
i= rate of interest
n= number of periods
Now we would compute the compound amount in above example using compound amount formula:

= P1000 x ( 1 + 5% ) 5
= P 1000 x ( 1 + .05 ) 5
= P 1000 x ( 1.05 ) 5
= P 1000 x 1.27628
= P 1276.28
Once the compound amount has been computed, the amount of interest earned over the invested period
can be computed by subtracting principal amount from the amount it is shown below.

Interest earned over 5 – year period P 1276.28 – P 1000 = P 276.28

Assessment Task ( 12 )

Name: ____________________________Course, Year & Section: _________________Score: _____

A. Find the missing terms:

No Principal Rate Time Interest
.
1. 5, 250 12% 3.5 yrs
2. 65, 500 1 ¾% 2 yrs
3. 8, 500 13% 4, 420
4. 15, 000 12% 9, 000
5. 50, 000 3 yrs 13, 500
6. 105, 000 1.5 yrs 17, 325
7. 8% 4 yrs 6, 000
8. 7% 4 yrs 24, 000
9. 5, 000, 000 8 ¾% 5 yrs
10. 10, 000, 000 12 ½% 3 yrs

B. Convert the following time as indicated.

1. 1.75 years to months

2. 2.05 years to semiannual periods

3. 56 months to years

4. 5years to quarterly periods

5. 2 years to semi-monthly periods

C. Solve the following problems.

1. Find the interest and amount on 880 at 8 ½% simple interest for 3 years.
 2. If an amount of 2,000 is deposited into a savings account at an annual interest of 5%,
compounded monthly, the value of the investment after 2 years is _____.

Credit Cards
A credit card is a plastic card that contains information and authorizes the person whose name
appears on it to change purchases or services to his/ her account for which he/she will be later billed .
The information in the card can be read by store readers and automated teller machines (ATMs).

A credit card is a revolving line of credit that allows you to make charges at any time up to the
amount of a specific credit limit.
Credit cards are utilized for daily expenses, such as food, clothing, tuition fees and other
emergency needs, interest are charged when the monthly balance is not paid in full. The interest on
credit cards average 15 percent, but can be as low as zero percent ( temporary , introductory offers) and
as high as 30 percent or more depending on the consumer’s payment history and credit score .
The use of credit card is a lot more flexible compared with consumer loan. One always has
available money for as long as he has not utilized the maximum credit limit. Similarly, this flexibility
can imply that some people may borrow more than what they are capable of paying. Hence, the credit
card requires discipline one should control the use of the card and should pay the credit before it earns
interest.

How Credit Cards Work?

When you swipe your credit card, your bank loans you the money to make that purchase.
Therefore is frequently an added cost to the consumer who purchases on credit. This added cost maybe
in the form of an annual fee or interest charges on purchases.
A finance charge is an amount paid in excess of the cash price; it is the cost to the customer for
the use of credit. Most credit card companies issue monthly bills. The due date on the bill is usually 1
month after the billing date (the date the bill is prepared and sent to the customer). If the bill is paid in
full by the due date, the customer pays no finance charge. If the bill is not paid by the due date, the
finance charge is added to the next bill.

Suppose a credit card billing date is the 9th day of each month, if a credit card purchase is made
on January 25,then February 9 is the billing date ( the 9th day of the month following January ).The due
date is March 9, ( one month from the billing date ). If the bill is paid in full before March 9, no finance
charge is added. However, if the bill is not paid in full , interest charges on the outstanding balance will
start to accrue ( be added ) on March 9 , and any purchase made after March 9 will immediately start
accruing interest.

The most common method of determining finance charges is the average daily balance method.
Interest charges are based on the credit cards average daily balance, which is calculated by dividing the
sum of the total amounts owed each day of the month by the number of days in the billing period.

Average Balance
The average daily balance is determined using the formula below:

Average daily balance = sum of the total amounts owed each day of the month / number of days in
the billing period.

Example:
Suppose an unpaid bill for P 15,550 had a due date of August 9. A purchase of P2, 800 was made
on August 18, and P 1,200 was charged on August 28. A payment of P 5000 was made on August 20.
The next billing date is September 9. The interest rate on the average daily balance is 3.5% per month.
Find the finance charge on the September 9 bill.

Solution:
 To find the finance charge, first prepare a table showing the unpaid balance for each purchase,
the number of days the balance is owed, and the product of these numbers. A negative sign in the
Payments of Purchases column of the table indicates that a payment was made on that date.

Date Payments of Balance each day Number of days Unpaid balance

purchases until balance times number of
changes days
August 9-17 P 15,550 9 P 139,950
August 18-19 P 2,800 P 18,350 2 P36,700
August 20-27 - P 5,000 P13,350 8 P106,800
August 28 P 1,200 P14,550 12 P 174,600
September 8
P 458,050

The sum of the total amounts owed each day of the month is P 458,050.

Find the average daily balance.

Average daily balance = sum of the total amounts owed each day of the month/ number of days in the
billing period

Average daily balance = 458,050/30 = 15,268 .33

Find the finance charge.

I = Prt
t = 15,268.33 (0.035) (1)
I = 534.39

Hence, the finance charge on the September 9 bill is P 534.39.

After you make a purchase with your credit card, the bank gives you a grace period- typically
between 20 and 30 days during which you can pay off that purchase before the interest begins to accrue.
Unlike a loan which has a fixed end date and regular monthly payments, with a credit card, you
choose how much to repay each month – a minimum payment, a partial payment or your entire balance.
With few exceptions, responsible credit card users always pay their balances in full every month.

Grace periods are powerful because they give you the opportunity to use your credit card as a
short but interest- free loan. As long as you pay every penny you charged last month before the due date,
you won’t pay interest on credit card purchases.

Unfortunately, many people do not pay their credit card balance in full each month, resulting to
accumulated interests.

Follow these credit card tips to help avoid common problems:

1. Pay off your balance every month...
2. Use the card for needs, not wants...
3. Never skip a payment...
4. Use the credit card as a budgeting tool...
5. Use a reward card...
6. Stay under 30% of your total credit limit...
7. Protect yourself from credit card fraud...

Consumer Loans
A consumer loan has a fixed date for monthly, where many people know- how to control their
finances.

Loan agreements have many forms and with varied terms, ranging from simple promissory notes
between friends and family members to more complex loans like mortgage, auto, payday and student
loans.

Banks, credit unions and other people lend money for other necessary items like car, home
improvement or tuition fees.
Types of Loans
Loan classifications differ because each loan has a specific intended use. They differ by due
dates, interest rates, basis of computation and other variables.

A. Student Loans
Student loans are for college students and their families to help cover the cost of tuition fees and
other expenditures relative to finishing a degree.

B. Mortgages
Mortgages are a loan offered by banks to consumer intending to buy homes they can’t pay in
cash .A mortgage is tied to the house purchased, meaning the house is subject for foreclosure if one
neglects to pay.

C. Auto Loans
This is also called as car loans. Like mortgages, auto loans are tied to the purchased car. You can
get your dream car, but you can lose it if you miss payments. This type of loan is offered by bank or car
dealership .Loans from car dealership is more convenient, however, has a higher interest rate which
results to a bigger amount to pay.

D. Personal Loans
Personal loans are used for personal expenses and don’t have a designated purpose. This is
attractive choice for people with existing debts like credit card debt, who want to reduce their interest
rates by transferring balances. Personal loan terms depend on credit history.

E. Payday Loans
Payday loans are short term, high – interest loans intended to solve budget problems from one
payday to the next. This is typically used by borrowers living payday to payday. Because of the high
interest rates, consumers are discouraged from availing payday loans.

F. Borrowing from Retirement & Life Insurance

Clients with retirement funds or life insurance plans are eligible to borrow from their accounts.
Repayment is much easier and less stressful since the amount actually borrowed is owned by the said
person. However, in some cases, failing to repay the loan leads to severe tax consequences.

G. Consolidated Loans
A consolidated loan is intended to simplify finances. Avail of consolidated loan pay several
outstanding debts like credit card debt it has fewer monthly payments and lower interest rates.

H. Borrowing from Friends and Family

Borrowing amount or cash from friends and relatives is an informal type of loan. Sometimes, this
is not a good choice, as it may damage relationships .Nevertheless, it’s an excellent idea to sign a basic
contract or promissory note to protect both parties.

I. Cash Advances
A cash advance is a short – term loan in the credit card. Cash can be received for whatever
intended purpose instead of using the credit card to purchase or pay other services. Cash advances are
also done by writing a check to lenders who collects during paydays.

Whenever you decide to borrow money – whether it is to pay the bills or buy a luxury item-
make sure you understand the agreement fully. Know what type of loan you’re receiving and whether it
is tied to any of your belongings.

Likewise, familiarize yourself with the terms of payment, how much you have to pay per month,
how long to pay the loan and the effects of missing a payment. If there is a part in the agreement which
is vague, don’t hesitate to ask for clarifications and further explanations.

Fund like a basket of stocks or bonds. Basically, money is pooled, along Mutual Fund
Mutual funds represent another way to invest in stocks, bond, or cash alternatives. Think of a
mutual with the money of other investors, into a fund, which then invests in certain securities according

to a stated investment strategy. The fund is managed by a fund manager who reports to a board of
directors. By investing in the fund, one’s own a piece of the pie (total portfolio), which could include
anywhere from a few dozen to hundreds of securities. This provide both convenient way to obtain
professional money management and instant diversification that would be more difficult and expensive
to achieve on one’s own,

The Nature of Stocks and Bonds

Many products, supplies and services like dresses, gadgets, foods, and entertainments are products
generated by a business firms. A business firm is an enterprise or a unit of economic organizations
which makes, buys, or sells products and or provides services in exchange of money. It may differ from
the other companies depending on the firms profit, rights, management strategies, sources of
investments and operating funds. Some firm maybe directed by a sole proprietorship, managed with a
business partner and others may be considered as large corporations. Corporations are most likely stated
out of a small business wishes to expand his company, he has to raise enough money to concretize the
plan. How will these small businesses grow and turn- out into a large corporation?

How business – persons do raise capital?

A business form or a company has several options to raise cash. The company owner may take
cash from their personal or business savings or a private loan from a bank. The company may also
consider a trade credit or a credit extended when materials and products are purchased and immediate
payment is not required, Furthermore; the company may also sell stocks and bonds.

A stock is a piece of paper (called a stock certificate) that represents a fractional ownership share
of a company or in a corporation. To further understand the concept of how stocks work, let us consider
the following example.

Example:
After graduation, a young entrepreneur named Danny opted to borrow money from a bank and
established a business. Danny named his business Danny’s Bikes. For the first few years, the business of
selling bikes makes little profit because the earnings were used for the store’s maintenance and
improvement and adding bike accessories of updated designs. After ten years, the business grew and
Danny was able to pay all his credits from the bank. From that time on, Danny earns 800,000 pesos
profit every year. The business has a book value of 2 million pesos and the average product stock is at
10 times the earnings. Therefore the Danny’s Bikes is worth 10 million pesos. The earnings will be
multiplied by 10 so it is 8 million pesos plus the book value of 2 million pesos.
Danny decided to have his own family, hence desires to open a branch. Danny discovered that to
expand his business, he will need 3 million pesos. Danny decided not to borrow from the bank, but

instead he contemplated to sell stock in his business. It only means that Danny owned 100% of the

business before selling a stock. If he will sell a stock then he will earn money but will lose a portion of
his ownership. So Danny decided to sell 40% of the business as a stock. Danny will owns a larger part of
the business which is 60%. Selling 40% to other interested entrepreneur would mean 4 million pesos
worth of the business. Utilizing this money from other investors. Danny’s Bike successfully opens a new
branch and has 1 million pesos remaining since opening a branch would only costs 3 million pesos.
Eventually, the business is earning an annual profit of 1.7 million pesos.

Given this illustrative examples, it can be seen how small businesses seem to grow fast when
they open to other entrepreneur. Before, the amount the owner generate from the business was only
limited to the profit. Since the business grew bigger, the owner can even sell their shares to other
businessmen to raise cash rapidly.

A stock is a measure of ownership in a company. Based on the example above, a stock is sold in
portions called shares which represent fractions of the company. Most major companies have literally
millions of shares divided up among businessmen and financial institutions who are collectively called
shareholders.
Bonds
Aside from selling a stock to earn cash, another source is a bond borrowed from an individual.
Bonds are loans from individual investor. Bike has two stores – the main store and a branch located in
another town. To further expand the business. Danny and the other shareholders decided to open two
new bigger stores which will be located at the southern and northern part of nearby cities. The company
should earn 8 million pesos in putting up these branches and 1 million pesos for venturing new products.
 A Chinese businessman Mr. Sy came and wanted be a part of the company. So, for the plan of
expanding the business. Danny’s Bike sells at a bond worth of 10 million pesos to Mr. Sy. Hence, Mr.
Sy as the lender now holds a bond on a contact. The company commits itself to repay the bondholder on
a monthly basis until the maturity date of 10 years, on the face of the bond , there is an agreement that
an annual interest of 100,000 pesos be paid .
Since the bonds have assured the investor a fixed interest and repayment at a certain date, the
bonds are considered a relatively safe investment. With this, the contract enables the Danny’s Bike to
obtain the capital they need at a lower interest rate. As a result, two new bigger stores were opened after
a year.

Based on the fictional story of Danny’s Bike , it is clear that a bond is a financial device through
which borrower , the company , is duty- bounded to pay the principal and interest on a loan at specific
date in the future to the lender or the bondholder.

The Market
Stocks and bonds are traded daily at stock exchange. In the Philippines, the agency is called the
Philippine Stock a big exchange .A stock market is the network of buyers and sellers of stocks included
on a stock exchange and also the stocks which are traded in private. In an exchange, a broker functions
as an agent. A broker determines the stock market values, advertise properties for sale, and show
properties to prospective buyers, and advice clients more practical buys.

If a company wishes to get a stock, the company may have it from the stock listed in the stock
exchange across the world or may look for a broker which represents a seller. This allows the company
to raise additional financial capital for expansion by selling or buying ownership in the market.
For example , one of the oldest stock exchanges in Asia is the Philippines Stock Exchange or
PSE ( 1927 ) PSE is the only stock exchange in the Country where trading of stocks is continuous from
9:30 am to 3:30PM daily with a recess from 12:00 PM to 1;30 PM PSE is the corporation that governs
our local market.

In addition, in a long term funding market, the participants can issue new credit, buy or sell
credits. Therefore, participants are either buyers or sellers of funds or both.

The impact of investors constantly buying and selling their shares is the unstable price per share
which fluctuates throughout the day and sometimes minute per minute. For this reason, the investors
should be vigilant also to monitor the movements of the stocks ‘price.

Investing in Bonds
Investing in bonds is just like investing in stocks. Bonds are solid on the market. They are
commonly known as “fixed income “securities.

When corporations or the government are trying to raise money, they sell those at a price lower
than the face value. The face value is just the original price shown on the security certificate. The price
you pay for them is given a percent of the face value. Any interest you received is based on the face
value. The following explains how we can use skills such as percent to solve such problems.

Example:
1. Find the cost of 4,000 worth of fixed income, which is sold for 80%?
Solution:
Cost of Bond = Face value x Percent of Face
Cost of Bond = 4,000 x 0.80
Cost of Bond = 3,200
Congruently, if the company tanks, the stock tanks.
How much interest will they pay you if the annual interest rate is 4 %?

Solution:
Interest = Face value x Annual Rate
Interest = 4,000 x 0.04
Interest = 160
The interest you will receive is 160

REFERENCES

Aufmann, R, J. Lockwood, R. Nation, and D. Clegg. 2018. Mathematics in the Modern World
14th Edition, Cengage Learning
Daligdig, Romeo. 2019. Mathematics in the Modern World. Lorimar Publishing Inc.

Rodriguez, MJ, I. Salvador, F. Ragma, E. Torres, E. Manalang, N. Oredina, and J. Ogoy. 2018
Mathematics in the Modern World. Nieme Publishing House Co. Ltd.Philippine
Copyright.
Note:
You can use all your available resources most convenient to you in our course.

THANK YOU AND KEEP SAFE EVERYONE

 Chapter 6 –Mathematical Logic
Learning Objectives:
 Discuss further the concept on mathematical logic
 Express word statements into symbols and symbols to words

Mathematical Logic

It is the analysis of the method of reasoning.

Logic Statement and Quantifiers

A logic statement is a declarative sentence that is either true or false. A simple statement
contains a single idea. A compound statement contains several simple statements (ideas). The
ideas in a compound statement are “connected” by connectives.

Moreover, the ideas can be represented by Tables of Symbols: P, Q, R,…

Logic Symbols Notation Meaning

Conjunction ˄ P˄Q P and Q
Disjunction ˅ P˅Q P or (inclusive) Q
Negation ~ ~P Not P
Conditional => P => Q If P then Q
Biconditional ‹=› P ‹=› Q P if and only if Q

Example: Let P = “Roses are red”, Q = “Violets are blue”.

Express each symbolic statement in English.

a. P ˄ Q ≡ Roses are red and violets are blue.

b. ~P ˅ ~ Q ≡ Roses are not red or violets are not blue.
c. ~ P => Q ≡ If roses are not red, then violets are blue.
d. P ‹=› Q ≡ Roses are red if and only if violets are blue.

Quantifiers expresses how many “objects” satisfy a given property or idea. A quantified statement is a
statement with at least one quantifier.
Universal Quantifiers: “All”, “Every”, “Each”
Existential Quantifiers: “Some”, “At least one”, “There exists”, “There is/are”

Example of quantified statements:

“All roses are red”, “Every rose is red”, “Each rose is red”
“Some violets are blue”, At least one violet is blue”
“There exists a blue violet”, There is a blue”

Truth Tables and Tautologies

A truth table shows the truth or falsity of a compound statement. It depends on the truth or
falsity of the simple statements from which it is constructed.

Example of a truth table

P Q P˄Q
T T T
 T F F
F T F
F F F
Tautology

A tautology is a formula which is “always true”…that is, it is a true for every assignment of truth
values to its simple components.

Example: (x-y)2 = x2 – 2xy + y2 is a tautology because it is always true.

In a table, tautology can be represented as follows:

P Q P => Q Q => P (P => Q) ˅ (Q =>P)

T T T T T
T F F T T
F T T F T
F F T T T

Conditional, Biconditional and Related Statements

A conditional statement is an if-then statement. For every conditional statement you can write
three related statements, the converse, the inverse, and the contrapositive. A biconditional statement is a
true statement using “if and only if”. The related statements are the converse, inverse and
contrapositive.

A converse statement is the reverse of the conditional statement. A converse of a conditional

statement is when the ‘if” and “then” parts are reversed. An inverse statement is the negative version of
the conditional statement. A contrapositive statement is the negative version of the converse statement.

Examples:

Conditional: If P, then Q (P => Q) If a figure is a square, then it is a quadrilateral.

Converse: If Q, then P (Q => P) If a figure is a quadrilateral, then it is a square.

Inverse: If~ P, then ~ Q (~P => ~ Q) If a figure is not a square, then it is not a quadrilateral

Contrapositive: If~ Q, then ~ P (~Q => ~ P) If a figure is not quadrilateral, then it is not a
square.

Symbolic Arguments

An argument is a set of statements, one of which is called the conclusions and the rest of which
are called premises. An argument is said to be valid if the conclusion must be true whenever the
premises are all true. An argument is invalid if it is not valid. it is possible for all the premises to be true
and the conclusion to be false.

Example:

If Edith eats her vegetables, then she can have a cookie.

Edith eats her vegetables,

‫ ؞‬Edith gets a cookie

Arguments and Euler Diagrams

An argument can be classified as either valid or invalid. A valid argument occurs in situations
where if the premises are true, then the conclusion must also be true. An argument can be valid even if
the conclusion is false.

Example:

First Premise: All dogs have fleas.

 Second Premise: Hank is a dog.
Conclusion: Hank has fleas.

Another way to analyze this is by using the Euler Diagram:

Objects with fleas

Dogs

Hank

The argument is not necessarily true, because you know that not all dogs have fleas. All this
shows that the argument is valid. If the two premises are true, then the conclusion must be true.

REFERENCES

Aufmann, R, J. Lockwood, R. Nation, and D. Clegg. 2018. Mathematics in the Modern World
14th Edition, Cengage Learning
Daligdig, Romeo. 2019. Mathematics in the Modern World. Lorimar Publishing Inc.

Rodriguez, MJ, I. Salvador, F. Ragma, E. Torres, E. Manalang, N. Oredina, and J. Ogoy. 2018
Mathematics in the Modern World. Nieme Publishing House Co. Ltd.Philippine
Copyright.
Note:
You can use all your available resources most convenient to you in our course.

THANK YOU AND KEEP SAFE EVERYONE

Assessment Task ( 13 )

Name: ____________________________Course, Year & Section: _________________Score: _____

A. Transform the symbols into words using the following representations:

P: Estela is a college freshman

Q: Estela is a class officer

1. P˅Q
2. P˄Q
3. ~P˄Q
4. P˅~Q
5. P ‹=› Q

B. Translate the words into symbols using the following representations:

P: Eva is a student
Q: Eva is a Filipina
1. Eva is a student and she is a Filipina.
2. Eva is a student and she is not a Filipina.
3. Eva is not a student nor is she a Filipina.
4. If Eva is a student, then she is a Filipina.
5. If Eva is not a Filipina, then she is not a student.

C. Given the Conditional Statement, “If the angles in a triangle measures 450, 450 and 900,
then it is an isosceles right triangle”. Construct a statement as to the following:

1. Converse
2. Inverse
3. Contrapositive
4. Conjunction
5. Negation
 CAPIZ STATE UNIVERSITY
Sigma Satellite College
Sigma, Capiz
Final Examination in GE 104 (Mathematics in the Modern World)
First Semester A.Y. 2021-2022

Name: ______________________________Course, Year & Section: ______________Score: ______

Test I – Multiple Choice Test

DIRECTIONS: Choose and write the letter of your answer on the space provided before each number.
_____1. Which of the following is the use of statistics?
a. It can give precise description of the data
b. It can predict the behaviour of individual
c. It can be used to test the hypothesis
d. All of these
_____2. The following are uses of statistics in business, except for one. Which is it?
a. Used in forecasting business trends
b. Used in formulation of National policy
c. Used in sales forecasting
d. Used in management and control
_____3. This of the following is a process used in the collection of data except for one. Which is it?
a. Experiment b. Test c. Interview d. Tables
_____4. This refers to the process of gathering relevant information from the population.
a. Interpretation of data b. Collection of data
c . Organization of data d. Analysis of data
_____5. This refers to the process of deducing relevant information from the given data so that
numerical description can be formulated.
a. Interpretation of data b. Collection of data
c. Analysis of data d. Interpretation of data
_____6. This refers to the process of deriving conclusion and giving of meaning and implication based
on the finding of the gathered data.
a. Collection of data b. Organization of data
c . Analysis of data d. Interpretation of data
_____7. This refers to the measure that tells where the center of the data is located.
a. Measure of Central Tendency b. Measures of Relative Position
c . Measures of Variability d. All of these
_____8. The mean of the set of numbers is 108. The sum of the numbers is 2, 052. How many numbers
are in the set?
a. 17 b. 18 c. 19 d. 20
_____9. A car dealer is recording a table indicating the number of cars of each color sold during the last
6 months. Which measure of central tendency is used to describe the bestselling color of the car
sold?
a. Mean b. Median c. Mode d. Range
_____10. John’s academic target is to get his test average in the top half of his Statistic class. Which
measure can he used to determine if he has achieved his goal?
a. Mean b. Median c. Mode d. Range
_____11. Eric is manufacturing wristbands. He produces 25 on Monday, 32 on Tuesday, 30 on
Wednesday, 29 on Thursday. Which measure of data would most accurately present the
number of wristbands Eric can make in one day?
a. Mean b. Median c. Mode d. Range

For item numbers 12-14. Use the following scores obtain during the surprise quiz in Mathematics.
83, 68, 62, 80, 66, 94, 67, 72, 56
_____12. Find the mean score
a. 67 b. 68 c. 72 d. 80
_____13. Find the median
a. 67 b. 68 c. 72 d. 80
_____14. Find the mode
a. 67 b. 68 c. 72 d. None of these
_____15. The median score is also the ______________.
a. 75th percentile b. upper quartile c. 5th decile d. first quartile
_____16. Juvy’s score in a 75-item was the median score. What is her percentile rank?
a. 75 b. 35 c. 37 d. 50
_____17. This refers to the value that divides the data into four equal parts.
a. Quartle b. Decile c. Percentile d. Median
_____18. This refers to the value that divides the data into two equal parts.
a. Quartle b. Decile c. Percentile d. Median
_____19. This refers to the value that divides the data into ten equal parts.
a. Quartle b. Decile c. Percentile d. Median
_____20. This refers to the value that divides the data into one hundred equal parts.
a. Quartle b. Decile c. Percentile d. Median

For item numbers 21-23. Use the following scores obtain by 9 students in a Math Quiz.
40, 45, 42, 37, 36, 32, 28, 26, 25
_____21. Find P12
a. 24.2 b. 25.2 c. 26.2 d. 27.2
_____22. Find Q2
a. 32 b. 36 c. 37 d. 40
_____23. Find D8
a. 37 b. 40 c.42 d. 45
_____24. Find D5
a. 32 b. 36 c. 37 d. 40
_____25. Find P80
a. 37 b. 40 c. 42 d. 45
_____26. If you have a variance, how do you get the standard deviation?
a. Square it b. Take the reciprocal c. Take the square root d. Subtract the mean
_____27. Why do you need the measures of variability?
a. To calculate the mean
b. To peak better volleyball teams
c. To understand the lowest and the highest point in the data
d. To describe how far the data are spread around the mean

For item numbers 28-33. Use the following scores obtain by 6 students in a Math Quiz.
20, 27, 23, 28, 23, 25
_____28. Find the Range
a. 6 b. 7 c. 8 d. 9
_____29. Find the Mean Absolute Deviation
a. 2.33 b. 2.33 c. 3.23 d. 3.33
_____30. Find the sample variance
a. 7.22 b. 7.42 c. 8.27 d. 8.67
_____31. Find the population variance
a. 6.22 b. 7.22 c. 8.22 d. 9.22
_____32. Find the population standard deviation
a. 2.69 b. 2.94 c. 3.69 d. 2.94
_____33. Find the sample standard deviation
a. 2.69 b. 2.94 c. 3.69 d. 2.94
_____34. Dr. GL has just given the mathematics exam and wanted to calculate the Range of
performance of his students. What must he do?
a. Identify the central score
b. Find the score that occurs often
c. Identify how far from the average each score is
d. Subtract the lowest score from the highest score

_____35. The variance and mean for a given set of data is 25 and 64 respectively. Calculate the standard
deviation.
a. 625 b. 8 c. 5 d. 2.56
_____36. This of the following is NOT TRUE about Normal distribution.
a. 68% of the data will fall within 1 standard deviation of the mean
b. 95% of the data will fall within 2 standard deviation of the mean
c. Almost 98% of the data will fall within 3 standard deviation of the mean
d. Almost 99.7% of the data will fall within 3 standard deviation of the mean
_____37. This of the following is NOT a property of a Normal distribution.
a. A curve is symmetric at the center
b. The mean, median and the mode are all equal
c. The total area under the normal curve is 2
d. The tails are asymptotic to the horizontal line and they extend to infinity
_____38. Mr. M invested 20, 000 which accumulates to 22, 500 in 10 months, find the simple interest
rate.
a. 10% b. 12% c. 14% d. 15%
_____39. Approximately how many months will 1, 000 accumulates to 1, 020 at 8% simple interest.
a. 2 months b. 3 months c. 4 months d. 5 months
_____40. 2.5 years is equivalent to how many quarterly periods.
a. 10 b. 12 c. 14 d. 16
_____41. 3 years is equivalent to how many semi-monthly periods.
a. 12 b. 18 c. 36 d. 72
_____42. If 10,000 investments earns 1, 800 in 10 months, find the rate.
a. 1.8% b. 18% c. 21.6% d. 21.8%

For item numbers 43-45. Supposed we have the following statements for P and Q.
P: It rains
Q: They can cancel school
_____43. The symbolic statement of “If they cancel school then it rains”
a. Q → P b. P → Q c. ~ P → Q d. ~ Q → P
_____44. For the statement “If it does not rain then they do not cancel school”
a. ~ Q → P b. ~ P → Q c. ~ P ˄ Q d. ~ Q ˅ P
_____45. For the statement “If they do not cancel school, then it does not rain”
a. ~ Q → P b. ~ Q → ~ P c. Q ˅ P d. Q → P

For item numbers 46-50. Consider the given proposition below.

“If you will review your lessons, then you will pass the Final Exam”
_____46. Find the Converse statement.
a. You will pass the final exam, if you will review your lesson
b. If you will not review your lesson, then you will not pass the final exam
c. If you don’t want to pass the final exam, then don’t review your lesson
d. If you will not review your lesson, then you will not pass the final exam
_____47. Find the Inverse statement.
a. You will pass the final exam, if you will review your lesson
b. If you will not review your lesson, then you will not pass the final exam
c. If you don’t want to pass the final exam, then don’t review your lesson
d. If you will not review your lesson, then you will not pass the final exam
_____48. Find the Contrapositive statement.
a. You will pass the final exam, if you will review your lesson
b. If you will not review your lesson, then you will not pass the final exam
c. If you don’t want to pass the final exam, then don’t review your lesson
d. If you will review your lessons, then you will pass the final exam, but you have reviewed
your lessons, therefore you can pass the final exam

_____49. Find the Negation statement.

a. You will pass the final exam, if you will review your lesson
b. If you will not review your lesson, then you will not pass the final exam
c. If you don’t want to pass the final exam, then don’t review your lesson
d. If you will review your lessons, then you will pass the final exam, but you have reviewed
your lessons, therefore you can pass the final exam

_____50. Find the Conjunction statement.

a. You will pass the final exam, if you will review your lesson
b. If you will not review your lesson, then you will not pass the final exam
c. If you don’t want to pass the final exam, then don’t review your lesson
 d. If you will review your lessons, then you will pass the final exam, but you have reviewed
your lessons, therefore you can pass the final exam

CONGRATULATIONS!

You have completed your Course GE 104 (Mathematics in the Modern World). Please submit
all your quizzes including your Final Examination on time.

Thank You! Stay Safe and God Bless Us All