DATA CENTER COLLEGE OF THE PHILIPPINES

Math of Investment

PROBLEM SOLVING. No computation, no points. Solve the following problems. Walang binigay ang
Diyos na problema na hindi natin kayang solusyonan. Kaya mag-tiwala lang sa taas. (5 points each)

Note: Round of all numbers to the nearest 3 decimal places

1. A second hand car was bought for 110,000. The buyer pays 45,000 cash. He sign a note with
a maturity value of 38,000 due in 1 year and the second note with maturity value of 15,000 due
in 1 ½ years. If the seller charges interest on the debt at 18% compounded quarterly, what
should be the maturity value of a third note due in 3 years that will pay off the remainder of the
debt? _________________________

2. How long will it take an investment to increase at least 40% in peso value if the interest rate is
10% compounded annually? __________________

3. Eli invested 85,000 at 11% compounded semi-annually on June 1, 2006. On what date will this
account have at least 98,900 in it? ______________

4. Paeng is investing 85,500 for 3 years and 6 months at Last Bank. If his money will accumulate
to 110,100, what rate compounded monthly is used? ____________________

5. A trust fund is valued at 150,000 today. If the fund is invested at 15% compounded quarterly,
find its value:

a. 3 ¾ years ago: ______________________

b. 5 ¼ years from now: __________________

6. Toti needs to accumulate 500,000 by the end of 4 years. How much must he invest now in
bank, if the bank offers to give him interest at 2 ¼ % every three months?
_________________

7. On December 1, 2005, Canuto borrows 250,000 from Tenots and agrees to pay the compound
amount on the day he settles the account. If interest is at the rate of 11% compounded
quarterly, how much must Canuto pay to discharge the debt on August 1, 2009?
___________________

8. On September 11, 2007, Lolit discounted a note with a maturity value of 110,110 due on
December 11, 2010 at 10 ½ % compounded semi-annually. How much proceeds did Lolit
received? ______________

9. Mark borrowed 75,700 from Fidel with the agreement that interest is charged at 9%
compounded monthly. If the maturity value of his loan is 101,101, when is it due?
_________________

10. Apeng placed 34,400 in an investment firm. If this amounted to 42,200 after 4 years anf 8
months, find the rate used if it is converted monthly?

11. Rafael receives a loan of 18,790 with interest at 7% compounded quarterly. He promises to
pay his creditor in full on the day when 26,275 will be due. How long does it take for Rafael pay
the debt? ___________________