LAS 9

The risk-return tradeoff is the principle that potential return rises with an
increase in risk.
True

Risk is the income received on an investment plus any change in market

price.
False
A return is the variability of returns from those that are expected.
False
Time value of money deals with future value and present value.
True
The time value of money is the idea that money available at the present
time has the same worth in thefuture due to its potential earning
capacity.
FalseSQ10
This is the current worth of a future sum of money or stream of
cash flows given a specified rate of return.
Present value
Which of the following is not needed in solving for annuity.
Principal
Which of the following is not needed in solving for simple interest.
Number of times the interest iscompounded per year
Which of the following is not needed in solving for compound interest.
Periodic payment at the end ofevery period
On the part of the borrower, this is the interest paid on the original
amount, or principal, borrowed.
Simpleinterest
This is a series of equal payments made at the end of consecutive
periods over a fixed length oftime.
Annuity
This is the value of a current asset at a specified date in the future based
on an assumed rate of growth overtime.
Future value
Which is not a component of return?
 Principal
This is a fee paid for using another party's money.
Interest
This is the interest paid (earned) on any previous interest, as well as on
the principal borrowed (lent).
Compound interestLAS10
Glen is depositing Php 5,000 every year for about 4 years. The simple
interest rate is 10%. Whatis the total value of the money at the end of
the 4th year?AnswerAShella made a bank deposit worth Php 20,000.
With 5% annual interest, how much is the totalinterest after 3
years?AnswerSHannah made a bank loan worth Php 200,000 with 5%
interest compounded semi-annually (2times in a year). If she will pay
the whole amount at the end of the term, how much will be thevalue of
the loan after 2 years?AnswerAJohn made a bank deposit worth
Php 10,000. With 2% interest compounded annually, how muchis the
total interest after 2 years?
What is the present value of a grant worth Php 5,000 payable at the end
of every month for 4years, if money is worth 2% compounded monthly
(12 times a year)?AnswerC
SQ10
What is the present value of annuity of Php 1,500 payable at the end of
every year for 2 years, if money isworth 12%?
Php 3,265.50
Shella made a bank deposit worth Php 21,550. With 5% annual interest,
how much is the total interest after3 years?
Php 3,232.50
Ben needs to have Php 20,000 after two years. Assuming that he will
only deposit once, with a 5% interestcompounded annually, how much
will you deposit today?
Php 35,434.43
Glen is depositing Php 5,500 at the end of every period for about
4 years. It has 10% interest ratecompounded annually. What is the total
value of the money at the end of the 4th year?
Php 25,525.50
Jenny made a bank deposit worth Php 20,550 which will earn 5% annual
interest. What is the value of thismoney after 3 years?
Php 23,632.50
Hannah made a bank loan worth Php 200,550 with 5% interest
compounded semi-annually (2 times in ayear). If she is to pay at the end
of the period only, how much will be the value of the loan after 2 years?
Php 221,369.68
John made a bank deposit worth Php 30,555. With 5% interest
compounded semi-annually(2 times a year),how much will be the
value of your money after 3 years?
Php 35,434.43
John made a bank deposit worth Php 10,500. With 2% interest
compounded annually, how much is thetotal interest after 2 years?
Php 424.20
Ken wants to have Php 100,000 after 5 years. If the bank pays 5%
interest on deposits, how much must hedeposit today in order to
have that amount in the future?
Php 78,352.62
What is the amount of annuity of Php 1,555 payable at the end of every
year for 2 years if interest rate is10%?
Php 3,265.50LAS11
Generally, the higher the risk the higher the return can be.

True
Investing also makes your money work for you and is considered as a
valuable financial resource.

True
Bonds are means of protection from financial loss.
False
Common stockholders are usually paid first and common stockholders
are paid if there is remainingdistributable income.
False
Properties bought is not considered as investments. .
FalseSQ11
This is a term usually used to describe properties such as lands and
buildings.
Real eastate
These term describes the people who receive allocated profits in form of
dividends.
Stockholders

These are investment securities that enable investors to pool their money
together into one professionallymanaged investment.
Mutual funds
This is a mutual fund term commonly used to describe the combined
holdings in one form.
Portfolio
These are securities that signifies ownership in a corporation and
represents a claim on part of thecorporation's assets and earnings.
Stocks
It is a contract in which an individual or entity receives financial
protection or reimbursement againstlosses from the insurer or the
insurance company.
Insurance
These are also known as a fixed-income security. These are debt
instruments created for the purpose ofraising capital.
Bonds
The value of equipement decreases as time passes by because it is being
used. With this statement we cansay that the equipment ________
in value.
Depreciate
This is an asset or item that is acquired with the expectation that it will
generate interest, income orappreciate its value in the future.
Investment
Payments on insurances are called insurance _________.
PremiumsLAS12
Ponzi scheme is a type of pyramid scheme, this is where money from
new investors is used to provide areturn to previous investors.
True
Real estate schemes are sold as short-term loans to buyers, construction
loans to companies, or even asshares in a building that will earn income
and pay it out to investors. Scam artists offer high, guaranteedrates of
return to investors seeking steady income from a tangible asset like real
estate.
True
Boiler rooms cold call potential investors and pressure them to buy
shares. Boiler room operators often setup in a different jurisdiction or
country than the people they target in order to avoid detection by
securitiesregulators and enforcement agencies.
True
Forex scams offer investors the opportunity to invest in foreign
exchange, but in the end, the money is lostto those running the scheme.
True
Setting up a High-Yield Investment Program scheme is relatively cheap.
Operators buy a domain name,design a webpage, and publish it on the
Internet. Once it's live on the Internet, the promoters are in business.
Their next step is to attract investors from all over the world.
TrueSQ12
This is a form of microcap stock fraud that involves artificially inflating
the price of an owned stockthrough false and misleading positive
statements, in order to sell the cheaply purchased stock at a higher price.
Offshore investing scheme
This is a fraudulent investment scheme from illegitimate or non-existent
organizations outside yourcountry.
Offshore investing scheme
This type of scheme is extremely difficult for your local law
enforcement agencies to investigate becausethe individuals involved
are foreign criminals.
Offshore investing scheme
This is a type of pyramid scheme, this is where money from new
investors is used to provide a return to previous investors.
Boiler room scheme
Scammers mislead investors by suggesting that big financially sound
institutions participate in their programs, when in fact such connections
do not exist.
Prime bank
A person earns by recruiting people who would pay a registration fee
without getting any goods to inexchange of their payments. The
recruited person also earns in the same manner.
Pyramid scam
This scheme can survive simply by persuading most existing participants
to reinvest their money, with arelatively small number of
new participants
Ponzi scheme
This scheme cold call potential investors and pressure them to buy
shares. Boiler room operators often setup in a different jurisdiction or
country than the people they target in order to avoid detection by
securitiesregulators and enforcement agencies.
Boiler room scheme
This is a scheme that attempts to boost the price of owned stock through
false recommendations,misleading or greatly exaggerated statements in
order to sell the cheaply purchased stock at a higher price.
Pump and dump
This offer investors the opportunity to invest in foreign exchange, but in
the end, the money is lost to thoserunning the scheme.
Forex scams
SQ13
Within 2 years, Jenny-a senior high school student will buy
the Malacañang Palace. AnswerNWithin 3 years, Anna plans to
buy a lot worth Php 1,000,000 by loaning in PgIBIG. AnswerSKen
plans to buy a cell phone worth Php 2,000. He plans to buy it after
two month bysaving a part of his daily allowance. AnswerSWithin
2 years, Jenny-a senior high school student will buy
the Malacañang Palace. AnswerN After 200 years, Jenny plans
to build a house worth Php 1,000,000 by loaning saving apart of
her salary. AnswerS
SQ13
Cherry paid the electricity and water bills. This statement best describes.
Spending
Kiela went to the sarisari store and she bought food on account. This
is to be paid when she gets her salarynet week.
Borrowing
Garry gave Php100 for the BantayBata fund.
Donating
This defines all financial decisions and activities of an individual
or household, including budgeting,insurance, mortgage planning,
savings and retirement planning.
Personal finance
Mr. Pan is working as a corporate accountant, he earns Php50,000 in
a month. This statement bestdescribes.
Earning
Mr. Chen bought a land.
Investing
John contributes every month to the SSS for his retirement benefits.
Saving
Anna bought food and drinks.
Spending
Ms Kelly had an emergency situation, she made a cash advance from her
workplace worth Php10,000.This statement best describes
Borrowing
John earns Php 2,000 in a week. He always see to it that he deposits
Php500 every week in his cooperative personal account. This amount is
reserved for future economic activities.This statement best describes
SavingLAS14
It is good to plan ahead on how to allocate your income for savings
and expenses.
True
Don't expect that you will be earning interest if you did not deposit an
amount in your bank account.
True
It is good to have negative credit record
.False
Savings is only possible if income is lower than expenses.
False
Don't take time to think about your financial goals, along with a realistic
plan for achieving them. It's just awaste of time.
FalseSQ14
Jen decided to deposit her money in a cooperative savings acccount
because it yield higher interest than bank savings account. Which
statement best depicts the situation?
Compare interest rates
Which statement is correct?
It is important know exactly what your goals are so you can create
a plandesigned to achieve those objectives.
Jenny engages in time deposits in the bank. Which statement best
depicts the situation?
Start saving atyoung age
Mr. Ken disburses an extra amount for his SSS and Pag-IBIG
contributions. Which statement best depictsthe situation?
Pay yourself first
Which is not a principle of personal finance?
Start saving an old age
John, a government employee, plans retire at the age on 55. Which
statement best depicts the situation?
Map your financial future
Which is not a principle of personal finance?
Stay assured
Mr. John determines his monthly salary, overtime pays, taxes, SSS, Pag-
IBIG and PhilHealthcontributions. Which statement best depicts the
situation?
Know your take home pay
Which statement is correct?
Insurances can help you recover in case of losses
Which is not a principle of personal finance?
Sell insurance to avoid being wiped out by a financial loss,such as
an illness or accident.
 BFIN SECOND QUARTER EXAM 50/50"Statement I. Long-term
goals should be planned in coordination with short-term and
intermediate onesStatement II. Setting and achieving short-term goals is
the basis for achieving long-term goals. "Select one:a. Both Statements
are False b. Statement I is true; Statement II is falsec. Statement I is
False; Statement II is Trued. Both Statements are True
CorrectFeedbackThe correct answer is: Both Statements are TrueArmi
deposits Php 4,500 at the beginning of each month (12 times a year) in a
fund that serves at 24%compounded monthly. How much is the fund
at the end of 3 years?Select one:a. Php 48,571 b. None of thesec. Php
283,654.15 Correctd. Php 384,654.15FeedbackThe correct answer is:
Php 283,654.15Jenny decided to buy a lot to be used in the future for her
planned business. She invested inSelect one
a. Bonds b. Bank depositc. Insuranced. Real estate
CorrectFeedbackThe correct answer is: Real estateJen made a
bank deposit worth Php 15,000. With 9% annual interest, how
much is the future value of hisdeposit after 5 years?Select one:a.
Php 21,750 Correct b. Php 28,500c. Php 15,675d. Php
13,500FeedbackThe correct answer is: Php 21,750Which is not
a basic principle of personal financeSelect one:a. Start saving at
young age b. Know your take home payc. Don't borrow what you
can't repayd. Expend everything you have because you have lots
of money CorrectFeedbackThe correct answer is: Expend
everything you have because you have lots of moneyWhich is not
a basic principle of personal financeSelect one:a. Map your
financial future b. Low returns means high risks Correctc. Don't
borrow what you can't repayd. Budget your moneyFeedbackThe
correct answer is: Low returns means high risksThe fruit trees
attached on a farm is considered asSelect one:a. Insurance b. Real
estate Correctc. Productd. StocksFeedbackThe correct answer is:
Real estateJohn has a highly dangerous job. He pays premiums
every month by depositing the money to the bankaccount of the
 engaged company. He does this so that he will have remuneration
in case he will besuffering from an accident. John is investing
onSelect one:a. Bonds b. Insurance Correctc. Mutual fundsd. Bank
depositsFeedbackThe correct answer is: InsuranceWhich is a
SMART goal?Select one:a. To graduate with the distinction - cum
laude b. Marry wants to buy 10 pcs of bond papers for her art
class.c. Chen plans to buy a new bag worth Php2,000. He plans to
buy it after two month by saving a part of hisdaily allowance.
Correct
d. Franz aims to go to Disneyland.FeedbackThe correct answer is: Chen
plans to buy a new bag worth Php2,000. He plans to buy it after two
month bysaving a part of his daily allowance.What is the present value
of annuity due of Php 2,500 payable at the beginning of every year for 4
years, ifinterest rate is 10%?Select one:a. None of these b. Php 8,717.13
Correctc. Php 9,909.25d. Php 14,304.80FeedbackThe correct answer is:
Php 8,717.13Scammers mislead investors by suggesting that big
financially sound institutions participate in their programs, when in fact
such connections do not exist.Select one:a. Offshore Investing
Scheme b. Ponzi schemec. Prime bank Correctd. Pump and
dumpFeedbackThe correct answer is: Prime bankThis is a type
of security that signifies ownership in a corporation and represents a
claim on part of thecorporation's assets and earnings.Select one:a.
Mutual funds b. Insurancec. Real estated. Stock CorrectFeedbackThe
correct answer is: StockYou need to have Php 51,000 after 3 years.
Assuming that you will only deposit once with a 5% annualinterest, how
much will you deposit today?Select one:a. Php 48,571 b. Php 44,348
Correctc. Php 44,056d. Php 16,190FeedbackThe correct answer is: Php
44,348"Statement I. According to our lesson, before committing to
significant expenditures, estimate how muchincome is likely to
be available for you.Statement II. Two factors commonly influence your
financial aspirations for the future. The first is thetime frame in which
you would like to achieve your goals. The second is the type of financial
need thatdrives your goals. "Select one:a. Both Statements are False b.
Both Statements are True Correctc. Statement I is true; Statement II is
falsed. Statement I is False; Statement II is TrueFeedbackThe correct
answer is: Both Statements are True"Statement I. An investment is an
asset or item that is acquired with the expectation that it will
generateinterest, income or appreciate its value in the futureStatement
II. A bond is a type of security that signifies ownership in a corporation
and represents a claimon part of the corporation's assets and earnings.
"Select one:a. Statement I is False; Statement II is True b. Both
Statements are Falsec. Statement I is true; Statement II is falsed. Both
Statements are True CorrectFeedbackThe correct answer is: Both
Statements are TrueWhat will a deposit of Php 4,500 at 10%
compounded semiannually be worth if left in the bank for
sixyears?Select one:a. Php 7,959.55 b. None of thesec. Php 8,181.55d.
Php 8,081.55 CorrectFeedbackThe correct answer is: Php 8,081.55This
is a form of fraudulent investment operation where the individual or
organization operator paysreturns to its investors from new capital
paid to the operators by new investors recruited.Select one:a. Offshore
Investing Scheme b. Pump and dumpc. Ponzi scheme Correctd. Prime
bankFeedbackThe correct answer is: Ponzi schemeWhat annual interest
rate would you need in order to have an ordinary annuity of Php7,500
per yearaccumulate to Php 279,600 in 15 years?Select one:a. 14% b.
None of thesec. 16%d. 12% CorrectFeedbackThe correct answer is:
12%Ben is a senior high school student. Which of his goals is
realistic?Select one:a. To buy all the candies in the world b. To top the
final exam Correctc. To be the president of Africa after a yeard. To
travel throughout space and live in MarsFeedbackThe correct answer is:
To top the final examA senior high school student deposits a part of his
salary to his bank account so that he will have funds forfuture use.
Which statement best depicts the situation?Select one:a. Pay yourself
first b. Know your take home payc. Start saving at young age Correctd.
Budget your moneyFeedbackThe correct answer is: Start saving at
young ageYou need to have Php 100,000 after 4 years. Assuming that
you will only deposit once with a 10% annualinterest, how much will
you deposit today? than an ordinary annuity of Php 1,000 per year for
15 years.Select one:a. True Correct b. Cannot be determinedc. May be
true and may be falsed. FalseFeedbackThe correct answer is: TrueThis is
a type of security that signifies ownership in a corporation and
represents a claim on part of thecorporation's assets and
earnings.Select one:a. Bank deposit b. Insurancec. Bonds Correctd. Real
estateFeedbackThe correct answer is: BondMarry wants to buy 10
pcs of bond papers for her art class. The statement best describesSelect
one:a. Consumable-product goals Correct b. Intermediate goalc.
Durable-product goalsd. Long-term goalFeedbackThe correct answer is:
Consumable-product goalsJennie, the owner of Hawaii Resort used her
money to put up an additional cottage. Jennie invested inSelect one:a.
Stocks b. Productc. Insuranced. Real estate CorrectFeedbackThe correct
answer is: Real estateWhich is not a principle of personal finance?Select
one:a. Pay yourself first b. Start saving an old age Correctc. Know your
take home payd. Budget your moneyFeedback uct goalsc. Durable-
product goals Correctd. Specific Product GoaldFeedbackThe correct
answer is: Durable-product goalsWhich is not a principle of personal
finance?Select one:a. Stay insured b. Borrow what you can't repay
Correctc. Budget your moneyd. Map your financial futurets are True
CorrectFeedbackThe correct answer is: Both Statements are TrueGarry
plans to buy a calculator to aid him in his math class. The statement
best describesSelect one:a. Intermediate goal b. Durable-product goals
Correctc. Consumable-product goalsd. Long-term goalFeedbackThe
correct answer is: Durable-product goals"Statement I. Short-term goals
have a time frame from one to five years.Statement II. intermediate
goals involve financial plans that are more than five years off, such
asretirement, money for children's college education, or the purchase
of a vacation home"Select one:a. Both Statements are True b.
Statement I is true; Statement II is falsec. Statement I is False;
Statement II is Trued. Both Statements are False CorrectFeedbackThe
correct answer is: Both Statements are FalseQuestion textHow much
will an ordinary annuity of Php 650 per year be worth in eight years at
an annual interest rate of8 percent?Select one:a. Php 6,433.38 b. Php
6,913.79 Correctc. Php 6,366.10d. Php 4,800.27FeedbackThe correct
answer is: Php 6,913.79What will a deposit of Php 4,500 at 12%
compounded monthly (12 times a year) be worth at the end
of 10years?Select one:a. Php 14,851.80 Correct b. None of thesec. Php
14,304.80d. Php 13,997.40FeedbackThe correct answer is: Php
14,851.80This is a type of investment which consists of money placed
into a banking institution.Select one:a. Bonds b. Real estatec.
Insuranced. Bank deposit CorrectFeedbackThe correct answer is: Bank
depositWhich is not a principle of personal finance?Select one:a.
Purchase insurance to avoid being wiped out by a financial loss, such as
an illness or accident. b. Obtain rate information from multiple
financial services firms to get the best value for your moneyc. Be an
irresponsible borrower who repays as promised, showing you are
worthy of getting credit in thefuture. Correctd. An annual budget to
identify expected income and expenses, including savings, will help you
live withinyour income.FeedbackThe correct answer is: Be an
irresponsible borrower who repays as promised, showing you are
worthy ofgetting credit in the future.John made a bank deposit worth
Php 10,000. With 0.1% annual interest, how much is the future value
ofhis deposit after 4 years?Select one:a. Php 14,000 b. Php 10,400c.
Php 10,040 Correctd. Php 11,000FeedbackThe correct answer is: Php
10,040Which of the following is not needed in solving for annuitySelect
one:a. Number of times the interest is compounded per year b. Periodic
payment at the end of every periodc. Interest rated. Principal
CorrectFeedbackThe correct answer is: PrincipalWhat will a deposit of
Php 4,500 at 7% compounded annual interest be worth if left in the
bank for nineyears?Select one:a. Php 8,385.78 b. Php 8,273.25
Correctc. None of thesed. Php 8,279.23FeedbackThe correct answer is:
Php 8,273.25This is the management of money and financial decisions
for a person or family including budgeting,investments, retirement
planning and investmentsSelect one:a. None of these b. Personal
Finance Correctc. Corporate Financed. Business finance