GENERAL MATHEMATICS – Business Math 2nd QTR 2019 – 2020
SIMPLE INTEREST AND MATURITY VALUE
1. A bank offers 0.25% annual simple interest rate for a particular deposit. How much
interest will be earned if 1 million pesos is deposited in this savings account for 1 year?
2. How much interest is charged when P50, 000 is borrowed for 9 months at an annual
interest rate of 10%?
3. When invested at an annual interest rate of 7%, the amount earned P11, 200 of simple
interest in two years. How much money was originally invested?
4. If an entrepreneur applies for a loan amounting to P500, 000 in a bank, the simple interest
of which is P157, 500 for 3 years. What interest rate is being charged?
5. How long will a principal earn an interest equal to half of it at 5% simple interest?
6. Find the maturity value if 1million pesos is deposited in a bank at an annual simple
interest rate of 0.25% after (a) 1 year (b) 5 years?
7. How much should you invest at the simple interest rate of 7.5% in order to have
P300,000 in 2 years?
8. If you deposit P5, 500 in a bank at an annual simple interest rate of 0.5%, how much will
you have after 12 years?
9. How much should you invest at 6% annual interest rate to obtain a simple interest of
P72,000 in 3 years?
10. How long will an amount of P50, 000 gain a simple interest of P10, 000 at 4% per
annum?
11. Calculate the maturity value of a $5000 loan with the simple interest of 10% per year.
The duration of the loan is 3 years.
12. A loan of $1000 was repaid at the end of 15 months. What amount was repaid, if a simple
interest rate of 10% was charged?
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GENERAL MATHEMATICS – Business Math 2nd QTR 2019 – 2020
COMPOUND INTEREST
1. Find the maturity value and the compound interest if P10 000 is compounded annually at
an interest rate of 2% in 5 years.
2. Find the maturity value and interest if P50 000 is invested at 5% compounded annually
for 8 years.
3. Suppose your father deposited in your bank account P10 000 at an annual interest rate of
0.5% compounded yearly when you graduate from kindergarten and did not get the
amount until you finish Grade 12. How much will you have in your bank account after 12
years?
4. What is the present value of P50 000 due in 7 years if the money is worth 10%
compounded annually?
5. How much money should a student place in a time deposit in a bank that pays 1.1%
compounded annually so that he will have P200 000 after 6 years?
6. What are the amounts of interest and maturity value of a loan for P20 000 at 6&
compound interest for 3 years?
7. In order to have P50 000 in 5 years, how much should you invest if the compound
interest is 5%?
8. A savings account in a bank yields 0.25% compound interest annually. (a )Accumulate
(find the future value of) P25 000 for 4 years in this savings account, (b) How much
interest will be gained?
9. In a certain bank, Angel invested P88 000 in a time deposit that pays 0.5% compound
interest in a year. How much will be her money after 6 years? How much interest will she
gain?
10. On the 7th birthday of her daughter, Shirlee deposited an amount in a bank peso bond
fund that pays 1.0% interest compounded annually. How much should she deposit if she
wants to have P100 000 on her daughter’s 18th birthday?
11. A businessman invested P100 000 in a fund that pays 10.5% compounded annually for 5
years. How much was in the fund at the end of the term?
12. Christian deposited P5 000 in a bank that pays 2% compounded annually. Complete the
table below:
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GENERAL MATHEMATICS – Business Math 2nd QTR 2019 – 2020
A. COMPOUNDING MORE THAN ONCE A YEAR
1. Find the maturity value and interest if P10 000 is deposited in a bank at 2% compounded
quarterly for 5 years.
2. Find the maturity value and interest if P10 000 is deposited in a bank at 2% compounded
monthly for 5 years.
3. Cris borrows P50 000 and promises to pay the principal and interest at 12% compounded
monthly. How much must he repay after 6 years?
4. Find the present value of P50 000 due in 4 years if money is invested at 12%
compounded semi-annually.
5. What is the present value of P25 000 due in 2 years and 6 months if money is worth 10%
compounded quarterly.
6. Accumulate P15 000 for 2 years at 15% compounded monthly.
7. How much should Kaye set aside and invest in a fund earning 2% compounded quarterly
if she needs P75 000 in 15 months?
8. Peter is planning to invest P100 000. Bank A is offering 5% compounded semi-annually
while Bank B is offering 4.5% compounded monthly. If he plans to invest this amount for
5 years, in which bank should he invest? Show complete solution.
9. How much must Angel deposit in a bank that pays 0.75% compounded quarterly so that
she will have P200,000 after 15 years?
10. Alet borrowed P15,000 payable with interest that is compounded semi-annually at 9%.
How much must she pay after 3 years?
11. What present value, compounded quarterly at 6%, will amount to P59,780.91 in 3 years?
12. Suppose that you have P80,000. You decided to deposit it on a bank and will not
withdraw from it for 10 years. A bank offers two types of compound interest accounts.
The first account offers 6& interest compounded monthly. The second account offers
6.5% interest compounded semi-annually. Which account will you choose if you want
your money to earn more? Show solution.
B. FINDING INTEREST RATE AND TIME IN COMPOUND INTEREST
1. How long will it take P3,000 to accumulate to P3,500 in a bank savings account at 0.25%
compounded monthly?
2. How long will it take P1,000 to earn P300 if the interest is 12% compounded semi-
annually?
3. In how many years will it take P18,000 accumulate to P20,000 when deposited in a
savings account that earns 0.25% compounded monthly?
4. How long will it take P15,000 to earn P5,000 if it is invested at 12% monthly?
