1 | General Mathematics

FINDING THE PRINCIPAL AMOUNT AND TIME

IN COMPOUNDED INTEREST

Now it is your turn to try a few problems on your own. Work on each of the problems below and make
sure to present the solutions for each of them. (In uploading your work via LMS, please follow this
format: GIGANTANA-M2CompoundInterestWorksheet

Problem 1: If you deposit Php4,500 at 5% annual interest compounded quarterly, how much money
will be in the account after 10 years?

P=4,500 , r=0.05 , t=10 , n=4

( )
nt
r
A=P 1+
n

( )
(4 )(10)
0.05
A=4,500 1+
4
A=7,396.29

Therefore, after 10 years I will receive a total amount of Php7,396.29.

Problem 2: If you deposit Php4,000 into an account paying 9% annual interest compounded monthly,
how long until there is Php10,000 in the account?

P=4,000 , r=0.09 , n=12 , A=10,000

log
P( )
A

t=
( rn )
log 1+

( )
log
10,000
4,000

log (1+
12 )
0.09
t=
12
122.6296724
t=
12
t=10.2

Therefore, it would take 10.2 years to accumulate Php10,000 in my account.

Problem 3: If you deposit Php2,500 into an account paying 11% annual interest
compounded quarterly, how long until there is Php4,500 in the account?

P=2,500 ,r =0.11, n=4 , A=4,500

log
P( )
A

t=
( rn )
log 1+

n
log( )
4,500
2,500

log (1+
4 )
0.11
t=
4
21.66662507
t=
4
t=5.4
 2 | General Mathematics

Therefore, it would take 5.4 years to accumulate Php4,500 in my account.

Problem 4: How much money would you need to deposit today at 5.5% annual interest
compounded monthly to have Php50,000 in the account after 10 years?

r =0.055 , n=12 , A=50,000 , t=10

A
P=
( )
nt
r
1+
n
50,000
P=
( )
(12)(10)
0.055
1+
12
P=28,883.76

Therefore, I need to deposit Php28,883.76 to have Php50,000 in my account after 10 years.

Problem 5: If you deposit Php6,000 into an account paying 6.5% annual interest
compounded quarterly, how long until there is Php12,600 in the account?

P=6,000 ,r =0.065 , n=4 , A=12,600

log
P
A
( )
t=
( rn )
log 1+

n
log( )
12,600
6,000

log (1+
4 )
0.065
t=
4
46.0276548
t=
4
t=11.5

Therefore, it would take 11.5 years to accumulate Php12,600 in my account.

Problem 6: If you deposit Php5,000 into an account paying 8.25% annual interest compounded semi-
annually, how long until there is Php9,350 in the account?

P=5,000 , r =0.0825 , n=2 , A=9,350

log ( PA )
t=
( rn )
log 1+

n
log ( 9,350
5,000 )

t=
(
0.0825
log 1+
2 )
2
15.48512579
t=
2
t=7.7
 3 | General Mathematics

Therefore, it would take 7.7 years to accumulate Php9,350 in my account.

4 | General Mathematics