ILOILO SCIENCE AND TECHNOLOGY UNIVERSITY

EECon 1- Engineering Economy

MID-TERM EXAMINATION (PART 2)

Name:___________________________ Course, Year & Section: ____________

ID#: _________________ Date: ______________ Signature: ______________

INSTRUCTION: Read and understand the problem properly. Write your solution only in short bond paper
in each number. Please limit erasures. Encircle or box your final answer.
HOW TO SEND: Please capture your solution clearly so that I can read it well- with your name and ID#.
Send it to my second Facebook account – Adrian L. Pillano or thru my email account
apillano073@gmail.com.

1. Engr. Trinidad loans from a loan firm an amount of P100,000 with a rate of simple
interest of 20% but the interest was deducted from the loan at the time the
money was borrowed. If at the end of one year, she has to pay the full amount of
P100,000, what is the actual rate of interest?
2. A loan of P5,000 is made for a period of 15 months, at a simple interest rate of
15%, what future amount is due at the end of the loan period?
3. Mr. Bacani borrowed money from the bank. He received from the bank P1,842
and promised to repay P2,000 at the end of 10 months. Determine the rate of
simple interest.
4. A man invested P110,000 for 31 days. The net interest after deducting 20%
withholding tax is P890.36. Find the rate of return annually.
5. The exact simple interest of P5,000 invested from Jan 21, 1995 to June 25, 1995
is P100. What is the rate of interest?
6. What is the effective rate corresponding to 18% compounded daily? Take 1 year
is equal to 360 days.
7. What rate of interest compounded annually is the same as the rate of interest of
8% compounded quarterly?
8. What annuity is required over 12 years to equate with a future amount of P
30,000? Assume i= 8% annually.
9. A factory operator bought a diesel generator set for P 10,000.00 and agreed to
pay the dealer uniform sum at the end of each year for 5 years at 8% interest
compounded annually, that the final payment will cancel the debt for principal and
interest. What is the annual payment?
10. A person buys a piece of lot for P 100,000 downpayment and 10 deferred
semi-annual payments of P 8,000 each, starting three years from now. What is
the present value of the investment if the rate of interest is 12% compounded
semi-annually?
11. A young engineer borrowed P 10,000 at 12% interest and paid P 2,000 per
annum for the last 4 years. What does he have to pay at the end of the fifth year
in order to pay off his loan?
12. You borrow P3,500.00 for one year from a friend at an interest rate of 1.5% per
month instead of taking a loan from a bank at a rate of 18% per year. How much
lesser you will pay by borrowing the money from the bank?