TIP Manila Refresher Course 3 October 2015

7/17/2019 TIP Manila Refresher Course 3 October 2015

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1. What is the efective rate o

interest o 10% compounded

continuously?

a. 10.42% c. 10.62%

b. 10.52% d. 10.2%

2. What annuity is re!uired over

12 years to e!uate "ith a uture

"orth o #20$000? ssume i &

6% annually.

a. #1$1'5.54 c. 1$210.62

b. 1$(05.20 d. 1$1(5.52

(. )*+ has a current sellin,

price o #400. - the sellin, price

is epected to decline at a rateo 10% per annum due to

obsolence$ "hat "ill be its

sellin, price ater 5 years?

a. #21(.10 c. #2(6.20

b. #24/.50 d. #200.00

4. n employee obtained a loan o

#10$000 at the rate o 6%

compounded annually in order

to repair a house. o" muchmust he pay monthly to

amortie the loan "ithin a

period o 10 years?

a. #110.22 c. #111.22

b. #112.22 d. #10/.22

5. - the efective annual interest

rate is 4%. ompute the

e!uivalent nominal annual

interest rate compounded

continuously.a. (.10% c. (.6/%

b. (.56% d. (./2%

6. man loans #1'$400 rom a

ban3 "ith interest at 5%

compounded annually. e

a,rees to pay his obli,ations by

payin, ' e!ual payments$ the

rst bein, due at the end o 10

years. ind the annualpayments.

a. #44$600.10 c.

#44$6(.20

b. #44$4'/.4 d.

#44$/'0.56

. he eas i,h"ay 7epartment

epects the cost o

maintenance or a particular

piece o heavy e!uipment to be

#5000 in year 1$ #5500 in year

2 and amounts increasin, by

#500 throu,h year 10. t an

interest rate o 10% per year$

the present "orth o the

maintenance cost is nearest to

a. #('220 c. #46660b. #4210 d. #51/0

'. he rst year maintenance cost

or a ne" automobile is

estimated to be #10$000 and it

increases at a uniorm rate o

10% per year. 8sin, an '%

interest rate$ calculate the

present "orth o cost o the rst

5 years o maintenance.

a. #4'04( c. #2'(2

b. #(5'21 d. #1/'6

/. machine costs #'000 and an

estimated lie o 10 years "ith a

salva,e value o #500. What is

its boo3 value ater ' years

usin, strai,ht line method?

a. #4000 c. #2000

b. #(000 d. #1000

10.n asset is purchased or

#/$000 its estimated economic

lie is 10 years ater "hich it "ill

be sold or #1$000. ind the

depreciation in the 1st ( years

usin, strai,ht line method.

a. #1400 c. #(400

b. #2400 d. #4400

11. broadcastin, corporation

purchased e!uipment or

#5($000 and paid #1$500 or

rei,ht and delivery char,es to

the 9ob site. he e!uipment has

a normal lie o 10 years "ith a

trade:in value o #5$000 a,ainst

the purchase o ne" e!uipment

at the end o the lie. 7etermine

the annual depreciation cost by

sin3in, und method. ssume

annual interest rate o 6%.a. #155.46 c. #(55.46

b. #255.46 d. #455.46

12. radio service panel truc3

initially cost #56$000. -ts resale

value at the end o the 5th year

o the useul lie is estimated at

#15$000. ;y means o declinin,

balance method$ determine the

depreciation char,e or the 2nd

year.



a. #6655.20 c. #''66.20

b. #55.20 d. #//66.20

1(.-n the previous problem$ "hat is

the boo3 value ater the 4th

year?a. #4($04/.4 c.

#25$405.6(

b. #(($06(.54 d.

#1/$521.('

14.n asset has a 1st cost o

#22$000$ an estimated lie o (0

years$ and an estimated

salva,e value o #2$000. 8sin,

the double declinin, balance

method$ nd the depreciation

char,e in the 6th year.

a. #10('.6 c. #(0('.6

b. #20('.6 d. #40('.6

15.-n the previous problem$ "hat is

the boo3 value ater 10 years.

a. #11$0(5.46 c. #/$61(.11

b. #10$2//.6 d. #'/2.24

16. telephone company

purchased a micro"ave radio

e!uipment or #6million. rei,ht

and installation char,es

amounted to 4% o the

purchased price. - the

e!uipment "ill be depreciate

over a period o 10 years "ith

salva,e value o '%. 7etermine

the depreciated cost durin, the

5th year usin, <=7.a. #626$26/.10 c.

#6('$22.0'

b. #622$0'.0 d.

#62$/'.06

1.-n the previous problem$ "hat is

the total depreciation ater 5

years?

a. #2$'1'$210./1

b. #($54'$'5'.1'

c. #4$15$12.2

d. #4$6/$01'.1'

1'. concrete a,,re,ate mi is

re!uired to contain at least (1%

sand by volume or proper

batchin,. *ne source o

material$ "hich has 25% sand

and 5% coarse a,,re,ate$

sells or >( per cubic meter.

nother source$ "hich has 40%

sand and 60% coarse

a,,re,ate$ sells or >4.40m(.

7etermine the least cost per

cubic meter o blended

a,,re,ates.

a. >(.0 c. >(.60b. >(.56 c. >(.46

1/.alculate the time re!uired to

produce the hundredth unit o

production run i the rst unit

too3 (2 minutes to produce and

the learnin, curve rate or

production is '0%.

a. 4.2min c. 6.2min

b. 5.2min d. .2min

20. machine is under

consideration or purchase. he

cost o the machine is >25$000.

@ach year it operates$ the

machine "ill ,enerate a savin,s

o >15$000. Aiven an efective

annual interest rate o 1'%$

"hat is the discounted paybac3

period on the purchase in the

machine?a. 1.6yr c. 2.15yr

b. 1.5yr d. (.1

21.;in, borro"ed a certain amount

on *ctober 1//0 rom Bason.

"o years later$ ;in, borro"ed

a,ain rom Bason an amount o

#500. ;in, paid #200 on

*ctober 1//( and dischar,ed

his balance by payin, #00 on

*ctober 1//5. What "as the

amount borro"ed by ;in, on

*ctober 1//0 i the interest rate

is '% compounded annually.

a. #260.51 c. #206.51

b. #216.51 d. #261.51

22.he volatility o a stoc3 is ound

to be 1.5times the stoc3 mar3et

avera,e. - the ris3 premium or

buyin, stoc3s avera,es '.(%and the present treasury bill

rate Cassumed to be ris3 reeD is

%$ "hat is most nearly the

epected return C@ED on the

stoc3?

a. 12.45% c. 1'.4/%

b. 15.4(% d. 1/.45%

2(.n investment o dollars is

made at the end o each year

or ( years$ at an interest rate



o /% per year compounded

annually. What "ill the dollar

value o the total investment

be$ most nearly$ upon the

deposit o the (rd payment?

a. #0. c. #2.('b. #1.(' d. #(.2'

24.*# @@ Eevie" and rainin,

enter ,ross mar,in is 45% o

sales. *peratin, epenses such

as sales and administrative

costs are 15% o sales. *# is in

a 40% ta brac3et. What

percent is their prot ater

taes?

a. 0.0% c. 1'.0%

b. 5.0% d. 24.0%

25.he maintenance on a machine

is epected to be #155 at the

end o the rst year and it is

epected to increase #(5 each

year or the ollo"in, years.

What sum o money should be

set aside no" to pay themaintenance or the ei,ht year

period? ssume 6% interest.

a. #15./0 c. #1665./'

b. #1656./' d. #1/55.'/

26.he maintenance o a room air

conditioner is epected to be

#2000 at the end o the rst

year and is epected to increase

by #100 each year or the

ollo"in, years. ssumin,

rate o interest is 6%$ compute

the e!uivalent uniorm annual

maintenance cost.

a. #2(1/.52 c. #56('.12

b. #1245.(6 d. #55'6.4

2.o" lon, "ill it ta3e to double

itsel i invested at 5%

compounded annually?

a. 1(.yrs c. 14.2yrsb. 14.yrs d. 15.(yrs

or problems 2' to (0

loan shar3 lends money on

the ollo"in, termsF G- - ,ive

you >50 on +onday$ you o"e

me >60 on the ollo"in,

+onday.G2'.What nominal interest rate per

year CrD is the loan shar3

char,in,?

a. 1010% c. 10(0%

b. 1020% d. 1040%

2/.What efective interest rate per

year is he char,in,?

a. 1($104% c. 1$(10$400%

b. 1(1$040% d.

1($104$000%

(0.- the loan shar3 started "ith

>50 and "as able to 3eep it$ as

"ell as all the money he

received$ out in loans at all

times$ ho" much money "ould

he have at the end o one year?

a. >555$2(1.55 c.>55$2(1.55

b. >655$2(1.55 d.

>'55$2(1.55

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TIP Manila Refresher Course 3 October 2015