GM Long Quiz

This is the amount that a person gets or pays on top of the original investment or loan.

If the compounding period is semimonthly, what is the frequency (in years)?

• 2

• 6

• 12

• 24

This refers to the party using the money or credit.

This refers to the amount of money extended for credit or the amount of money deposited in a bank for safekeeping.

This is the interest rate per compounding period. This is equal to the nominal rate divided by the number of compounding periods in a year.

• compounding period

• nominal rate

• periodic rate

• compound amount

Tony borrowed ₱150 000 from a bank to finance his new business venture. How much interest will Tony pay if the bank charged him a 4% simple interest rate for the loan payable in two years?

• ₱6 000

• ₱12 000

• ₱156 000

• ₱162 000

Chris owes Carol ₱50 000. He promised to pay the said amount in 6 months at 5% simple interest. How much is the interest?

• ₱1 250

• ₱2 500

• ₱5 000

• ₱15 000

Steve placed his money worth ₱150 000 in an investment instrument that earns 6% simple interest rate per year. How much will his money be after 5 years?

• ₱45 000

• ₱50 000

• ₱195 000

• ₱200 000

Peter invested his money in an investment instrument that earns 8.25% simple interest. What is the maturity value of Peter’s money worth ₱50 000 after 3 3/4 years?

• ₱14 437.50

• ₱15 468.75

• ₱64 437.50

• ₱65 468.75

Natasha currently has ₱2 500 000. She wants to buy a house worth ₱5 000 000. If she wants to loan the money from a bank to complete the payment for the house, how much will she pay the bank if the interest rate charged by the bank is 2.6% simple interest and the term of interest is 5 years and 6 months?

• ₱2 857 500

• ₱2 875 500

• ₱5 715 000

• ₱5 751 000