PALAWAN STATE UNIVERSITY – BROOKE’S POINT CAMPUS Education Department

MODULE FOR MATHEMATICS OF INVESTMENT | JOVENGRACE F. CABAHUG – Course Instructor

Source: Young, Felina C., (2014), Mathematics of Investment Made Simple. REX BOOKSTORE INC., Metro Manila, Philippine;
Calmorin, Laurentina P., et.al., (2012), Mathematics of Investment with Computer Application. REX BOOKSTORE INC., Metro Manila, Philippine

LESSON 1: THE SIMPLE INTEREST

CHECK YOUR PROGRESS 1

Answer the following. Show your complete solution.

1. Suppose an amount of Php500.00 is invested for 2 years at 6% per year. How much is the
interest of the investment after two years?

2. and
1.Answer If Php4,
Solution000.00 is borrowed at an annual interest rate of 16% for 9 months, what is the value
of the interest of the investment after 9 months?
Organize the given information in a list.

I = ?, P = Php500.00, r = 6%, t = 2 years

We will use the simple interest formula to find the interest.

Write the formula.

I = Prt

Substitute the given information. Remember to write the percent in decimal form.

I = (500)(0.06)(2)

Simplify.

I = 60

The simple interest is Php90.00

2. Answer and Solution

I. Organize the given information.

I = ?, P =Php4,000.00, r =16%, t = 9 months

Write the formula.

I = Prt

Substitute the given information, converting 10 months to 10/12 of a year.

I=(4,000)(0.16)(9/12)

Multiply.

I=480

The simple interest is Php480.00