Business

Mathematics
General Mathematics
 Converting Decimal to Percent
1. Convert 0.625 to a percentage.
2. Convert 45% to a decimal.
3. Express 0.02 as a percentage.
4. Convert 85% to a decimal.
5. What is 0.75 as a percentage?
6. Convert 7.5% to a decimal.
7. Express 0.042 as a percentage.
8. Convert 60% to a decimal.
9. What is 0.085 as a percentage?
10. Convert 125% to a decimal
Converting Percent to Decimal
To convert a percent to decimal, drop the percent
sign and move the decimal point two places to the
left.

When the number in the percent is a whole number,

the decimal point is understood to be stated at the
right of the last digit. For example, to convert 12% to
decimal, drop the percent sign and move the decimal
point two places to the left to get 0.12.
• Simple Interest ( ) – interest that is computed on
the principal. The interest remains constant
throughout the term.
• Lender or creditor – person (or institution) who
invests the money or makes the funds
available
• Borrower or debtor – person (or institution) who
owes the money or avails of the funds from the
lender
• Origin or loan date – date on which money is
received by the borrower
• Time or term (t) – amount of time in years the money
is borrowed or invested; length of time between the
origin and maturity dates
• Principal (P) – amount of money borrowed or
invested on the origin date
• Rate(r) – annual rate, usually in percent, charged by
the lender, or rate of increase of the investment
• Interest (I) – amount paid or earned for the use of
money
• Maturity value or future value (F) –amount after t years
that the lender receives from the borrower on the
maturity date
Simple Interest
Simple interest is charged only on the loan
amount called the principal. Thus, interest on
the interest previously earned is not included.
Simple interest is calculated by multiplying the
principal by the rate of interest by the number
of payment periods in a year.
Simple Interest Formula

𝐼 𝑠 =𝑃𝑟𝑡
Where:
I = interest
P = principal
r = rate of interest, and
t = time or term in years or fraction of a year
Maturity Value or Future Vale
𝐹 =𝑃 +𝐼𝑠
Where:
F = Maturity value
P = Principal
I = Interest
 Problem 1
Due to COVID-19 pandemic Miss Dada a female
resident of Brgy. May Pagkakaisa somewhere in
Quezon Province thinks of a business that can provide
for her needs as well as the need of her neighbors so
she can be of help even in this trying time.
Since she doesn’t have money on hand, she
decided to borrow from a bank as the
start-up capital of ₱50,000.00 at 7% simple interest
rate payable within 5 years.
Compute for the interest yield.
 Problem 2
To buy the school supplies for the coming school
year, you get a summer job at a resort. Suppose
you save ₱4 200.00 of your salary and deposit it
into an account that earns simple interest. After
9 months, the balance is ₱4 263.00. What is the
annual interest rate?
Exercise A
• Ramil deposited ₱20,000.00 at 4% simple
interest for 5 years. At the end of 5 years, his
account contains ₱24,000.00. Give the term
for each value in relation to the problem.
1. ₱20,000.00
2. ₱24,000.00
3. 4%
4. 5 year
Exercise B
Complete the table by finding the maturity
value.
Principal (P) Interest Rate (r) Time (t) Maturity Value (F)
₱ 35,600 6% 9 mo.
₱ 140,350 10% 15 mo.

₱ 75,800 8 ½% 2 yr.
₱ 340,200 11% 6 yr.

₱ 1,400,500 9% 10 yr.
DETERMINING THE
TIME PERIOD
General Mathematics
 A. Determining the Time Period

To find the due date, we must

determine the number of days in
each month. Then, we simply
compute month by month, the
number of days from one date to
another.
 Steps in Solving the number of days of a
Loan
1. Identify the number of days remaining the
first month by subtracting the loan date from
the number of days in that month.
2. Write the number of days in each month.
3. Write the number of days in the last montg
4. Add the days from the first month to the last
month.
 B. Actual and Approximate Time
The time period t should be determined using
the number of days involved. There are two
ways determining the time period. It may be
approximate or actual time.
 Approximate Time – Uses 30 days in every
month
 Actual Time – uses the exact number of days
in every specific month.
 Examples
1. A note dated February 28 is due to be paid in
August 1. How many days will the note run?
2. Find the due date for a 130-day note dated
July 7.
3. Determine the actual time and approximate
time from March 3, 2015 to September 10,
2015
4. Find the actual and approximate time from
November 18, 2015 to May 9, 2016
C. EXACT AND ORDINARY INTEREST
 Exact Interest is computed in 365 days in a year as the
time factor denominator.
 Ordinary Interest is a type of Interest wherein the
number of days is computed based on 360 days in a year.
 Bank and most institutions still use ordinary interest
because it yields a somehow higher interest compared to
exact interest method.
 If the type of interest is not specified in a problem, the
problem will be solved using the Banker’s Rule or
Ordinary interest in actual time.
 Formula
• Exact Interest

• Ordinary Interest
 Example 1
Find the interest on P28,700 at 7.3% from March
14, 2016 to August 16, 2016 using the following:
a. Ordinary Interest using Actual Time
b. Ordinary Interest using Approximate Time
c. Exact Interest using Actual Time
d. Exact Interest
Computing Loans
Involving Partial
Payments before
General Mathematics
Maturity
 Example 1
• Kevin borrowed P20,000.00 at 11%
interest for 150 days. On day 50,
Kevin made a partial payment of
P5,000.00. On day 80, she made a
second payment of P7,000.00. What
is the final amount due on loan?
 Figure 1
Partial Payment Time Line
 Your Turn!
• Lance owes P105,000 on a 6% 135-
day note. On day 35, he pays P45000
on the note. What is the new
maturity value of the loan?
Compound Interest
General Mathematics
 Example 1
Due to COVID-19 pandemic Miss Dada a
female resident of Brgy. May Pagkakaisa somewhere in
Quezon Province thinks of a business that can provide
for her needs as well as the need of her neighbors so
she can be of help even in this trying time.
Since she doesn’t have money on hand, she
decided to borrow from a bank with a start-up capital
of ₱50,000.00 at 7% interest rate compounded
annually and payable within 5 years. Compute for the
interest yield.
Compound Interest
 Compound Interest
• Compound interest ( ) is the interest computed on
the principal and also on the accumulated past
interest
• includes the interest from the current year and
added on the principal at the start of the following
year
• This means that the previous interest earns interest
as well, together with the principal until fully paid.
So the interest yielded on simple interest is lower
than the compound interest.
 Compound Interest
• It is a procedure in which the interest is
periodically calculated and added to the
principal.
• The time interval between succeeding interest
calculations is called conversion period
(compounding period or interval period)
• The compounding frequency (or conversion
frequency) is the number of compounding
that take place in a year.
 Figure 3
Compounding Frequencies and Periods
 Compound Interest
• The nominal interest is the stated
annual interest rate on which the
compound interest calculation is
based.
• The periodic interest rate is the rate
of the interest earned in one
conversion period.
 Compound Interest
F = Maturity Value of the loan or Investment
P = Principal Amount of loan or Investment
I = Amount of interest paid or received
j = nominal interest rate
m = number of conversion per year
t = time period (term) of the loan or investment
i = Periodic Interest rate
n = number of conversions of the loan
 Compound Interest Formula
Finding the Principal Amount

Finding the Future Value

Finding the Compound Interest

 Problem 1
What amount must be invested now in savings
account earning 9% compounded quarterly to
accumulate a total of P21,000 after 3
 Problem 2
Danica wants to provide a P200,000 graduation
gift for her daughter Mica, who is now 16 years
old. She would like the fund to be available by
the time her daughter is 20. She decides on an
investment that pays 10% compounded
quarterly. How large must the deposit be?
 Problem 3
Find the interest earned at the end of 4 years if
P36,700 is invested at 12% and compounded
semiannually.
Compound Interest: Your Turn!
1. Your father asked you about investment and
wanted to know the interest that will be
earned if he will invest ₱500,000.00 in a
certain bank that offers an annual
compounding interest of 8% for 5 years
2. Lorenz paid P8,600 on a loan made 2 years
before at 6% compounded semiannually. Find
the interest generated.
Activity: Find me