GENERAL MATHEMATICS

Name of Learner: _____________________________ Grade Level: _______________

Section: ___________________________ Date: ________________

LEARNING ACTIVITY SHEET

Calculating The Present Value and Period of Deferral of a Deferred Annuity

Background Information for Learners

Deferred Annuity
It is an annuity whose first payment starts at some future time.
Present Value
The present value of a deferred annuity is the sum of all the
present values of the periodic payment made after the deferred
period.

Period of Deferral
* It is also called deferment period
* It is a length of time from the present until the beginning of the first payment interval.
* In this period of time, the borrower does not need to pay for the principal amount and the interest.

To compute for the number of deferred payment periods, we can use the following:
1) if the periodic payment is made on the succeeding year, multiply the deferred years by "m", the number of
conversion periods per year.
Example: The quarterly payment of the annuity is deferred for 5 years.
d = number of deferred periods
m=4
Solution:
d = 5 x 4 = 20

2) if the periodic payment is due at the end of the deferment years, multiply the deferment years, multiply the
deferred years by "m" and subtract 1.
Example: The first quarterly payment of the annuity is due at the end of 3 years.
d = number of deferred periods
m= 4
Solution:
d = (3.4) -1= 11
Calculating The Present Value and Period of Deferral of a Deferred Annuity
Example:
1. Find the present value of the deferred annuity of PHP 2,000 every end of three months for 10 years if it is
deferred for 5 years. The money is worth 15% compounded quarterly.
Learning Competency
Calculating the Present Value and Present of Deferral of a Demand Annuity M11GM-IId-3

ACTIVITY 1
Directions/Instructions: Compute for the number of deferred payment periods. Write your solution in a ½ yellow
paper.
1. The quarterly payment of the annuity is deferred for 5 years.
2. The monthly payment of the annuity is deferred for 2 years.
3. The quarterly payment of the annuity is deferred for 3 years.
4. The first quarterly payment of the annuity is due at the end of 2 years.
5. The first monthly payment of the annuity is due at the end of 3 years.

ACTIVITY 2.
Directions/Instructions: Calculate the present value and period of deferral of a deferred annuity
. Write your solution in a ½ yellow paper.

1. Find the present value of the deferred annuity of PHP 3,000 every end of three months for 5 years if it is
deferred for 3 years. The money is worth 10% compounded quarterly.

References for Learners

 GENERAL MATHEMATICSS – Grade 11 Self-Learning Module (SLM)

 DEFERRED ANNUITY (COMPUTE PRESENT VALUE AND PERIOD OF DEFERRAL OF A DEFERRED ANNUITY) -
YouTube
 Chapter 12: Solution to Exercises – Business Math: A Step-by-Step Handbook Abridged (pressbooks.pub)

Prepared by

____ELOISA JOY M. MADRILENO_____

TEACHER 1