Slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. If you continue browsing the site, you agree to the use of cookies on this website. See our User Agreement and Privacy Policy.

Slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. If you continue browsing the site, you agree to the use of cookies on this website. See our Privacy Policy and User Agreement for details.

No Downloads

Total views

1,398

On SlideShare

0

From Embeds

0

Number of Embeds

2

Shares

0

Downloads

26

Comments

0

Likes

1

No embeds

No notes for slide

- 1. Discount Interest
- 2. <ul><li>Discount interest – a type of interest collected in advance and is taken from the amount of the loan applied for on the origin date </li></ul><ul><li>Formula for discount interest I d : </li></ul>
- 3. <ul><li>The amount of the loan originally applied for would be the maturity value. </li></ul><ul><li>The actual amount received by the borrower on the origin date is called the proceeds . </li></ul><ul><li>Denoted by P , it is the difference between the maturity value and the discount interest. </li></ul>
- 4. <ul><li>Example. Ben borrowed Php10,000 from Mon who charged 4% discount interest. How much did Ben receive if the debt is to be repaid in 10 months? </li></ul>
- 5. <ul><li>Derived formulas: </li></ul>
- 6. <ul><li>1. Given F = Php 37,500 , d = 8% , t = 5 years, find I d . </li></ul>
- 7. <ul><li>5. Given F = Php 290,000 , d = 10.35% , t = 40 months, find P . </li></ul>
- 8. <ul><li>7. Given P = Php 301,500 , d = 8.25% , t = 4 years, find F . </li></ul>
- 9. <ul><li>9. Given F = Php 4,063.49 , I d = Php 3,200 , t = 9 years, find d . </li></ul>
- 10. <ul><li>11. Given F = Php 12,000 , I d = Php 3,780 , d = 9% , find t . </li></ul>
- 11. <ul><li>15. If you borrow Php80,000 from a lender for one year and 2 months at 3% discount interest rate, how much proceeds will you receive? </li></ul>
- 12. <ul><li>17. Find the term of a loan whose proceeds and maturity value are Php56,225 and Php65,000, respectively. The discount interest rate applied is 6%. </li></ul>
- 13. <ul><li>21. Find the amount due at the end of 15 months if the present value is Php18,000 and if </li></ul><ul><li>a) the discount interest rate is 5% </li></ul><ul><li>b) the simple interest rate is 5% </li></ul>
- 14. <ul><li>27. If the discount interest rate is 11 %, how much time is needed for Php54,700 to become Php60,000? </li></ul>

No public clipboards found for this slide

×
### Save the most important slides with Clipping

Clipping is a handy way to collect and organize the most important slides from a presentation. You can keep your great finds in clipboards organized around topics.

Be the first to comment