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Quarter 2 - Module 3 What I Know What'S In: Simple Genera L Deferre D Presen T Term Futur E Deferra L

This document covers different types of annuities including simple, general, and deferred annuities. It provides examples of calculations for each type. Key information learned includes that simple annuities have equal payment and compounding frequencies, general annuities have unequal frequencies, and deferred annuities delay the start of payments. The document tests understanding with examples such as calculating the future value of a simple annuity with monthly deposits over 10 years and the cash value of lease payments over 4 years.

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92 views3 pages

Quarter 2 - Module 3 What I Know What'S In: Simple Genera L Deferre D Presen T Term Futur E Deferra L

This document covers different types of annuities including simple, general, and deferred annuities. It provides examples of calculations for each type. Key information learned includes that simple annuities have equal payment and compounding frequencies, general annuities have unequal frequencies, and deferred annuities delay the start of payments. The document tests understanding with examples such as calculating the future value of a simple annuity with monthly deposits over 10 years and the cash value of lease payments over 4 years.

Uploaded by

John
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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QUARTER 2 - MODULE 3

WHAT I KNOW 8. WE HEAL


9. WE RECOVER
1. WE HEAL 10. WE RECOVER
2. WE HEAL
3. WE RECOVER WHAT’S IN
4. WE RECOVER 1) COMPOUND INTEREST
5. WE HEAL 2) CONVESION PERIOD
6. WE RECOVER 3) INTEREST RATE
7. WE HEAL 4) ANNUITY
5) CASH VALUE

WHAT’S NEW
CODE 6 7 1 5 2 4 3
TERM SIMPLE GENERA DEFERRE PRESEN TERM FUTUR DEFERRA
L D T E L

1) DEFERRED
2) TERM
3) DEFERRAL
4) FUTURE
5) PRESENT
6) SIMPLE
7) GENERAL

WHAT’S MORE
1)
a. The type of annuity illustrated in the problem is SIMPLE ANNUITY
b. The term is 10
c. The number of conversion period is 12
0.09
d. The interest rate per period is =0.075
12
e. The present value of the deposit is PHP 30,000
2)
a. The type of annuity illustrated in the problem is GENERAL ANNUITY
b. The total number of payments is every 3 months=4 payments per year x 10 years =40
c. The number of conversion period annually = 1
d. The interest rate per period is 8% or 0.08
e. The present value of the loan is PHP 4,000

3)

a. The type of annuity illustrated in the problem is DEFERRED ANNUITY


b. The total number of payments is (monthly) 12x5(years)= 60
c. The number of conversion period in the period deferral is
12(monthly) x 4 (deferred conversion) = 48 -1(period deferral) =47
d. The interest rate per period is 0.12 / 12 = 0.01
e. The present value of the loan is PHP 30,000

WHAT I HAVE LEARNED

SIMPLE ANNUITY GENERAL ANNUITY

-Payments are made at the


-Payments are made at the end of the payment intervals,
end of the payment and the payment and
intervals, and the payment a fixed sum compounding frequencies
of money
and compounding are unequal.
paid to
frequencies are equal.
someone -The first payment occurs one
-The first payment occurs each year, interval after the beginning
one interval after the typically for of the annuity.
beginning of the annuity. the rest of
their life. -The last payment occurs on
-The last payment occurs on the same date as the end of
the same date as the end of the annuity.
the annuity.

WHAT I CAN DO
My uncle deposits a money for the education of his 7-year-old only son, PHP 500 at the end of each
month for 10 years at 5% annual interest compounded monthly. What is the future amount after 10 years?
Given: R= PHP 1,000
i = 5% or 0.05
t = 10 years
m = 12
Unknown : “ Future Value of Simple Annuity (F)
i t (m )
Formula: F=
R 1+( ) m
−1

i
m
10 ( 12 )
0.05
Solution: F=
PHP 1,0 00 1+ ( 12 ) −1
=PHP 395,042.28
0.05
12

Conclusion: The amount that will be available in 10 years is PHP 395,042.28

ASSESSMENT

Column X Column Y Column Z


2 A. Simple Annuity C 1. A car is to be purchased in monthly payments of 17 000.00 a. Php 36 647.36
Php for 4 years starting at the end of 4 months. How much is
the cash value of the car if the interest used is 12% monthly?
3 B. General Annuity A 2. A four-year lease agreement requires payments of 10 000.00 b. Php 6 825.05
Php at the beginning of every year. If the interest is 6%
compounded monthly, what is the cash value of the lease?
1 C. Deferred Annuity B 3. You make eleven semi-annual deposits of 550.00 Php into c. Php 626 571.56
a savings account. The interest rate is 4.72% compounded
quarterly. What will be its account balance?
Solution:
− ( k+n ) −k
i i
( ) ( )
( )
1− 1+ 1− 1+
m m
1) P=R − =PHP 17,000 ¿
i i
m m

−tm −4 ( 12 )
i 0.06
( ) ( )
( ) ( )
1− 1+ 1− 1+
m 12
2) P=R =PHP 10,000 =PHP 36,647.36
i 0.06
m 12

0.0472 11
( )
3) F=R ( ( 1+ j )n −1
j )=PHP 550
( 1+
4
0.0472
4
−1

)
=PHP 6825.05

ADDITIONAL ACTIVITIES

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