GenMath-2nd-Quarter Past Paper PDF

EXPLORING SIMPLE INTEREST Cash inflow are represented by rising arrows; Time or term – the amount of time in years the outflows by downward arrows; term by horizontal money is borrowed or invested. lines; and compounding per...

EXPLORING SIMPLE INTEREST Cash inflow are represented by rising arrows; Time or term – the amount of time in years the outflows by downward arrows; term by horizontal money is borrowed or invested. lines; and compounding periods by vertical marks. Maturity date – the date on which the total Annuity – a sequence of payments made at equal amount borrowed with interest is to be completed (fixed) intervals or periods of time repaid. Rental payment Creditor – the person or institution that invests Monthly pensions the money or makes the funds available. Monthly payment for car loan Principal – amount of money borrowed or Educational plan invested on the origin date. Amortization – loan of house and lot and pay the Maturity or future value – amount of t years that amount through installments. the lender receives form the borrower on the Payments interval – time between successive maturity date. payments Origin or loan date – the date on which money is General annuity – an annuity where the payment received by the borrower. interval is not the same as the interest period. Interest – sum of the money paid for the use of SIMPLE ANNUITY money. Future and Present Value the interest earned on a deposit or charged against a The sum of the compound amounts of all regular loan depends on three factors: payments in what we call the future value while the 1. The rate of interest (r) which is given by the bank sum of the principals of all the regular payment is or charged by the lender. present value. The compound amount of the present 2. The length of time (t) for which money is value is also equal to the future value of the annuity. deposited or borrowed Solving simple annuity (future and present value) 3. The sum of money deposited or borrowed which is Time diagram called the principle (p) R = regular payment or the periodic payment Final amount – total amount of money at the end of m = time between two successive payment dates the transaction period when money is deposited or t = time from the beginning of the first payment interval borrowed. to the end of the last one. (express as yearly) - Equal to the sum of the principal and the interest. S/F = (amount of annuity) F=P+I = sum of all the payment at the end of the term. F= final amount = the sum of all the compound amounts on hand P = principal amount at the end of the term of each payment accumulated I = interest until then from the date when it was due. Simpe interest – where interest on a deposit or loan A/P = (present value of an annuity) is computed once for the full term of the loan. = value of all the payments at the beginning of its I = Prt term. I = simple interest = the sum of all the present values of the P = principal payments made. r = rate of interest GENERAL ANNUITY t = length of time General annuity – annuity where the payment interval EXPLORING COMPOUND INTEREST is not the same with interest Compound interest – interest computed on the According to payment interval and interest period principal and also on the accumulated past interest. Simple – same Interest may be compounded annually, semi – General – not the same annually, quarterly or monthly R = regular payment F = final amount n = number of payments P = principal amount r = nominal rate I = rate of interest for each I + r/m conversion period. t = term of the annuity r = nominal rate of interest / annual interest rate. m1 = payment interval m = frequency of conversion periods in one year. m2 = length of compounding period n = total number of conversion period m(t) i = equivalent interest rate / payment t = number of years FAIR MARKET VALUE OF A CASH FLOW Frequency of conversion Value of m The fair market value or economic value of cash flow Annually m=1 (payment stream) on a particular date refers to a single amount that is equivalent to the value of the Semi – annually m=2 payments stream at that date: this particular date is Quarterly m=4 called Focal date Monthly m = 12 In it simplest sense, fair market value (FMU) CASH FLOW is the price that an asset would sell for on the open Cash flow – is a term that refers to payment received market (cash inflow) or payments or deposits made (cash DEFFERED ANNUITY (later payment) outflow) Deferred annuity – the annuity that does not begin Cash flow diagram – are visual representations of until a given time interval has passed. annuity whose revenue and spending over a period of time. payment (or deposits) start in more than one period FAIR PRICE OF THE BOND – present value of all cash from the present. inflows to the bondholder Period of deferral – time between the purchase of an REMEMBER! annuity and the start of the payment for the deffered. Per share should time to 100! STOCKS AND BONDS BUSINESS AND CONUSMER LOANS The heartbeat of the economy BUSINESS LOAN – money lent specifically for a Certificates that are sold to raise money starting a business purpose. It may be used to start a business new company or for expanding an existing company. or to have expansion. Also called securities. CONSUMER LOAN – money lent to an individual for People who buy them are called investors. personal or family purposes. TERM OF THE LOAD – time of the loan STOCKS AMORTIZATION – it is the process of paying off debt with regular payment made over time. These ownerships are called stocks. The buyers of MORTGAGE – it is a loan from a bank or other financial the stock (stockholders) receive stock certificates. institution that helps a borrower purchase a home or a Verifying the number of shares of stocks, they car. own. MORTGAGOR – the one who borrows a mortgage. TWO BASIC TYPES OF STOCKS MORTGAGEE – the one who lends a mortgage. 1. Common Stock – have voting rights. COLATERALS – assets that can secure a loan. 2. Preferred Stock – do not have voting rights. FIXED-RATE MORTGAGE – type of mortgage where DIVIDEND interest remains constant. Payment profit OBLIGATION – it is what parties may do under a Share in the company’s profit. contract or term of agreement. STOCK MARKET provides an orderly trading place for OUTSTANDING BALANCE – any remaining debt at a stock where in prices or market value pay from day to specified time. day and within a day. Only stockbrokers who Down payment x Cash price specialized in working in the stock market are allowed Cash price – down payment to trade on the floor. The broker receives a MARKET INDICES FOR STOCKS AND BONDS commission for the services of both buying and The measure of a portion of the stock market is called selling stocks. the stock market index. One of the examples is the BONDS PSE Composite index or PSEi. it is composed of 30 Form of long-term investment issued by a companies carefully selected to present the general corporation or governmentwhere the purchaser movement of market prices. Sector indices, indices becomes a creditor of the company. that representing a particular sector. The company state or municipality that issues the e.g. financial institutions, industrial corporations, bonds is called the issuer. holding films, service corporation, mining/ oil, The annual interest paid by the issuer to the leader property. (bond holder) on the bond is referred to as the coupon. The coupon rate is the annual payout as percentage of the bond’s par value. BONDS HAVE TWO KINDS OF VALUES 1. Par value – the same as its face value 2. Market value – the price at which the bond is being sold (it may be greater than or less than the amount of the par value)If the market value is greater than the par value, then the bond is selling at premium. Market value less than par value = discount DIVIDEND PER SHARE – ratio of the dividends to the number of shares STOCK YIELD RATIO – ratio of the annual dividends per share and the market value per share. Also called VALUE – it refers to the value of index. current stock yield. Chg - change the index value from the previous trading PRICE OF THE BOND – the price of the bond at day (the difference between the value today and value purchased time; denoted by P. yesterday) PAR VALUE / FACE VALUE – the amount payable on %Chg – ratio to Chg to Val (Chg divided by Val) the maturity date:denoted by F If P = F, the bond is purchase at par. If P < F, the bond is purchased at a discount. If P > F, the bond is purchased at premium. TERM OF THE BOND – fixed period of time (in years) at which the bond is The heading 52-WK-LOW is the lowest selling price redeemable as stated in the bond certificate; of the stock in the past 52 weeks. The lowest price at number of years from the time of which AAA stock traded during the past 52 weeks was purchased to maturity date. P68.  The heading HIGH is the highest selling price of the 4. Conditional ( -> ) stock on the last trading day. The selling price of AAA Sometimes called if then statements stock in the last trading day was P70. “if” hypothesis or premise and “then” The heading STOCK is a three letter symbol the conclusion company using for trading. Example AAA Represented p and Q The heading 52-WK-HIGH is the highest selling 5. Biconditional () price of the stock in the past 52 weeks. The highest A combination of two conditional statement price at which AAA stock traded during the past 52 ”P if and only if Q” weeks was P74.30 DETERMINING THE TRUTH VALUE OF The heading LOW is the lowest selling price of the PROPOSITIONS stock on the last trading day. The selling price of AAA Truth value of compound proposition with logical stock in the last trading day was P669.50 operators The heading DIV is the dividend per share last year. 1. Negation (ibabaliktad lang!) The dividend per share last year of AAA stock was 0.70. P ~P The heading VOL is the number of shares (in T F hundreds) traded in the last trading day. In this case, F T stock AAA sold 9050 shares of 100 which is equal to 2. Disjunction (pag may isang true, true na!) 905,000 shares. P Q PVQ The heading CLOSE is the closing price on the last T T T trading days. The closing price of AAA stock in the last T F T trading day was P70.25. F T T The heading NETCHG is the net change between F F F the last two trading days. BUYING OR SELLING STOCKS 3. Conjunction (pag may isang false, false na!) P Q P^Q T T T T F F F T F BID SIZE – the number of individual buy orders and F F F the total number of 4. Conditional (pag ung Q ay false, false na! maliban shares they wish to buy. sa last) BID PRICE – the price that buyers are willing to pay P Q P->Q for the stock. T T T ASK PRICE – the price that the sellers of the stock T F F are willing to sell the F F T stock. F F T ASK SIZE – how many individual sell orders have been placed in the online platform and the total number of shares these sellers wish to sell. “Good luck Guys, Papasa tayo amen” BOND MARKET INDICES -mik