SUMMATIVE TEST

GENERAL MATHEMATICS

1. Which type of interest is computed on the principal and then added to it periodically?
Compound interest

2. Interest that is computed on both the principal and the accumulated past interest is known as:
Compound interest

3. Given the same loan amount, term, and interest rate, which interest type provides a higher yield to the
lender?
Compound interest

4. What distinguishes compound interest calculations from simple interest calculations?

The frequency of conversion

5. Convert 3 years and 6 months into years in decimal form.

3.5 years

6. A principal amount of ₱8,000 is invested at an 9% annual interest rate for 6 years. How much is the
simple interest?
a) ₱600
b) ₱640
c) ₱3,840
d) ₱4,320

7. Using the previous question’s values, what is the maturity value of the investment?
a) ₱8,000
b) ₱8,640
c) ₱12,320
d) ₱11,840

8. A loan has a future value of ₱320,000, an 7% annual interest rate, and a compounding period of 4 years
and 6 months. What is the principal amount borrowed?
a) ₱236,005.96
b) ₱247,548.98
c) ₱350,000
d) ₱378,000

9. Based on the previous question, what is the total compound interest accrued?
a) ₱28,000
b) ₱102,451.02
c) ₱117,199.66
d) ₱83,994.04

10. A principal amount of ₱17,000 grows to ₱20,000 in 1 year and 6 months under simple interest. What is
the total interest earned?
a) ₱2,000
b) ₱2,800
c) ₱3,000
d) ₱3,800

11. What is the simple interest earned when ₱16,200 becomes ₱18,000 in 1 year and 6 months?
a. ₱2,000
b. ₱1,800
 c. ₱3,000
d. ₱3,800

12. At what simple interest rate per annum will ₱16,200 become ₱18,200 in 1 year and 6 months?
a. 8.23%
b. 15.03%
c. 25.05%
d. 28%

13. How long will it take for ₱60,000 to accumulate to ₱65,000 in a bank savings account at 2%
compounded monthly?
a. 3.5 years
b. 4 years
c. 5.88 years
d. 6.86 years

14. What is the number of compounding periods per year if interest is compounded quarterly?
a. 1
b. 2
c. 4
d. 12

15. What is the present value of an investment that will yield ₱100,000 in 4 years if compounded semi-
annually at 15%?
a. ₱56,070.22
b. ₱97,194.23
c. ₱102,194.23
d. ₱112,194.23

16. What is the periodic interest rate (i) if the annual rate is 15% compounded annually?
a. 0.025
b. 0.035
c. 0.075
d. 0.15

17. What is an annuity?

a. A series of payments made at equal intervals over time.
b. The sum of present values of all payments to be made.
c. The length of the payment interval.
d. The time between the first and last payment interval.

18. Which of the following best defines a general annuity?

a. An annuity where payments are made at the beginning of each interval.
b. An annuity where payments begin and end at definite times.
c. An annuity where the payment interval is different from the interest compounding period.
d. An annuity where the payment interval and interest compounding period are the same.

19. Which of the following is an example of a general annuity?

a. A house loan paid annually with 15% interest compounded annually.
b. A monthly loan payment with 6% interest compounded monthly.
c. A quarterly car installment with interest compounded quarterly.
d. A quarterly car installment with interest compounded semi-annually.

20. Which of the following is an example of a simple annuity?

a. A monthly house and lot installment with interest compounded monthly.
 b. A monthly loan payment with 8% interest compounded semi-annually.
c. A quarterly car installment with interest compounded yearly.
d. A quarterly car installment with interest compounded semi-annually.

21. What is an annuity?

a. A sequence of payments made at fixed intervals
b. The length of the payment interval
c. The sum of present values of all payments in an annuity
d. The time between the first and last payment intervals

22. Which of the following best defines a general annuity?

a. Payments are made at the beginning of each interval
b. Payments begin and end at definite times
c. Payments occur at intervals different from the compounding period
d. Payment intervals match the interest period

23. Which of the following is an example of a general annuity?

a. Annual house payment with 15% compounded annually
b. Monthly loan payment with 6% compounded monthly
c. Quarterly car payment with an interest rate compounded quarterly
d. Quarterly car payment with an interest rate compounded semi-annually

24. Which of the following is an example of a simple annuity?

a. Monthly house installment with interest compounded monthly
b. Monthly loan payment with 8% compounded semi-annually
c. Quarterly car payment with interest compounded annually
d. Quarterly car payment with interest compounded semi-annually

25. Mr. Harry saves ₱6,000 at the end of each month in a fund with 6% interest compounded monthly for 2
years. How much will be in his fund after 2 years?
a. Simple ordinary annuity
b. Simple annuity due
c. General ordinary annuity
d. General annuity due

26. What is the periodic payment made by Mr. Henry?

a. 2 years
b. 5%
c. 12
d. ₱6,000

27. What is the number of compounding periods per year?

a. 2 years
b. 5%
c. 12
d. ₱6,000

28. What is the periodic interest rate (i)?

a. 0.004167
b. 0.005
c. 4
d. 5%

29. What is the total value of Mr. Harry’s savings after 2 years?
a. ₱120,000
 b. ₱125,000
c. ₱125,929.60
d. ₱183,110.08

30. A micro bank pays 7.5% interest compounded quarterly. Anna deposits ₱20,000 at the end of every
month. How much will she have in 3 years?
a. Deferred annuity
b. Simple annuity due
c. General ordinary annuity
d. General annuity due

31. What is the term of Joanna’s deposit?

a. 3 years
b. Every 4 months
c. 7.5%
d. ₱20,000

32. What is the periodic deposit amount?

a. 3 years
b. Every 4 months
c. 7.5%
d. ₱20,000

33. What is the compounding frequency per year?

a. 0.05
b. 3
c. 4
d. ₱20,000

34. Inna is selling her property for ₱2,500,000. A buyer initially offers ₱2,250,000, but after negotiation,
they agree on a price of ₱2,350,000. What is the fair market value of the property?
a. ₱2,500,000
b. ₱2,350,000
c. ₱2,250,000
d. None of these

35. An annuity of ₱10,000 every 6 months for 3 years is deferred for 1 year, with an interest rate of 10%
compounded semi-annually. What type of annuity is this?
a. Deferred annuity
b. General annuity due
c. General ordinary annuity
d. Simple annuity due

36. What is the period of deferral for the annuity in the previous question?
a. 2 periods
b. 3 periods
c. 4 periods
d. 6 periods

37. What is the present value of the annuity in the problem above?
a. ₱15,089.54
b. ₱16,865.40
c. ₱18,068.37
d. ₱20,004.86
38. What do you call the share in a company’s profit given to stockholders?
a. Bonds
b. Coupon
c. Dividend
d. Stocks

39. Which type of stock gives the holder the right to vote in company decisions?
a. Common stock
b. Issued stock
c. Preferred stock
d. Treasury stock

40. What is the term used for the value stated on a stock certificate?
a. Market value
b. Par value
c. Present value
d. Prospective value

41. What is the current price at which a stock can be bought or sold?
a. Market value
b. Par value
c. Present value
d. Prospective value

42. Which of the following is an interest-bearing security that promises to pay back money with interest?
a. Bonds
b. Fund
c. Shares
d. Stocks

43. Which statement about bonds is NOT true?

a. They have lower risk but lower yield.
b. They are a form of debt financing.
c. They are a form of equity financing.
d. The holder is called a bondholder.

44. Which statement about stocks is NOT true?

a. They have higher risk but may offer a higher yield.
b. They are a form of debt financing.
c. They are a form of equity financing.
d. The holder is called a stockholder/shareholder.

45. What is the main platform for trading bonds and fixed-income securities in the Philippines?
a. Bangko Sentral ng Pilipinas
b. Bureau of Treasury
c. Philippine Dealing and Exchange Corporation (PDEx)
d. Philippine Stock Exchange (PSE)

46. What is the main platform for trading bonds or fixed-income securities in the Philippines?
a. Bangko Sentral ng Pilipinas
b. Bureau of Treasury
c. Philippine Dealing and Exchange Corporation (PDEx)
d. Philippine Stock Exchange

47-48. The three friends—Anna, Carla, and Vienna—invested different amounts to start ACV Company.
The total value of the business is ₱320,000. If Ana invested ₱80,000, how much ownership does she have?

47. What is the total value of ACV Company?

a. ₱200,000
b. ₱250,000
c. ₱280,000
d. ₱330,000

48. What percentage of the company does Ana own?

a. 25%
b. 30.30%
c. 45.45%
d. 55.55%

49. A BKY domestic corporation declared ₱50,000,000 in dividends for its common stocks. If the company
has 400,000 shares, how much is the dividend per share?
a. ₱20
b. ₱50
c. ₱100
d. ₱125

50. A bond has a face value of ₱250,000 and pays a 10% coupon rate, payable semi-annually. How much is
the semi-annual coupon payment?
a. ₱7,000
b . ₱7,500
c. ₱12,500
d. ₱150,000

51. What is a stock market index?

a. A dividend per share from the last year.
b. A measure of a portion of the stock market.
c. The net change between the last two trading days.
d. The total value of all stocks in the market.

52. How many traders are willing to sell 4,100 shares for ₱23.15 per share?
a. 1
b. 2
c. 5
d. 56

53. What is a mortgage?

a. A loan for personal use.
b. A loan granted for business purposes.
c. A loan secured by collateral.
d. An asset used to secure a loan.

54. Which of the following is NOT used for a chattel mortgage?

a. Car
b. Delivery truck
c. House and lot
d. Van

55. Which of the following is an example of a business loan?

a. Mr. Yuan applies for a loan to take a vacation.
b. Mr. Yuan applies for a loan to buy a car for his family.
 c. Mr. Yuan applies for a loan to renovate his house.
d. Mr. Yuan applies for a loan to open another branch for his shop.

56. Which of the following is an example of a consumer loan?

a. Ms. Luisa availed a chattel mortgage to fund her business.
b. Ms. Luisa availed a loan to purchase computers for her office.
c. Ms. Luisa availed a loan to purchase a car for her family.
d. Ms. Luisa availed a mortgage to expand her business.

57-58. If a house is sold for ₱4,500,000 and the bank requires a 25% down payment, calculate the down
payment and mortgage amount.

57. How much is the down payment?

a . ₱140,000
b. ₱350,000
c. ₱875,000
d. ₱1,125,000

58. How much is the mortgage loan?

a. ₱875,000
b. ₱2,625,000
c. ₱3,500,000
d. ₱3,375,000

59-60. A mortgage is amortized with a ₱5,000 monthly payment for 5 years. If the interest rate is 3%
convertible monthly, what is the outstanding balance after 10 payments?

59. What is the remaining payment period?

a. 12 months
b. 50 months
c. 60 months
d. 65 months

60. What is the outstanding balance after 5 payments?

a. ₱769,896.55
b. ₱256,632.18
c. ₱5,215,103
d. ₱29,997,913.04