Republic of the Philippines

Department of Education
REGION VIII – EASTERN VISAYAS
SCHOOLS DIVISION OF CATBALOGAN CITY

Office of the Schools Division Superintendent

LEARNER’S ACTIVITY SHEET FOR QUARTER 2, WEEK 1

General Mathematics
Competencies
Illustrates simple and compound interests M11GM-IIa-1

Distinguishes between simple and compound interests M11GM-IIa-1

General Reminders: Use this activity sheet with care. Do not put unnecessary mark/s on any
part of the activity sheet. Use a separate sheet of paper in answering the exercises. Read the
directions carefully before doing each task. Return this activity sheet to your teacher/facilitator
once you are through with it.

Explore (Review and Motivation)

Activity 1. Word Hunt
Instructions: Look for words/terms used in business. The word may be read
horizontally, vertically, diagonally or backward.

a d b i n t e r e s t s i m p l e s
f m a n t o n i o b m a d e m r e t
u n a w a s f e d o m a n e s h s n
t w e t y e s v e r y d u c h e s a
u n i v u c h e i r c a k e r g i t
r e w a r r v o j o n e m e s u m i
e x t r a t i r e w a i t e d i p o
v a x q u i n t w e i n r e g n l n
a d v e s h i x y r i e f l u s e a
l a l e n d e r e p t q u o i o i l
u s i l a n g a n a a x i a s d n c
e r o s e a q u i n z s a n e e t o
z a c h q u o s h g n a e d v e e m
e t k n o p n i r d y m e a r a r p
u e l o m u d a d a c a n t s r e r
s c h o o l a c r n y r u e h n s e
t u c p r i n c i p a l e t s i t z

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 Learn (What is it/Discussion of the Topic)

What is Interest?

Interest is a fraction or percentage being imputed to a sum of money. The sum of money
that someone borrows or lends is called principal amount. The interest rate is a percentage of the
principal amount which represents a cost or fee for borrowing or lending money. The term or loan
period is the agreed date or time when the loan will be paid in full. When you borrow money from
someone, you need to pay more than the principal amount you loaned depending on the interest
rate and term you both agreed on.
On the other hand, when you lend your money to someone or to a financial institution like
a bank, the principal amount you lent will be increased with interest. Interest is actually the fee
that you pay because you used someone else’s money or the fee that you receive because somebody
used your money. It is always accompanied with a predetermined interest rate and a specified
period of time.

What is Simple Interest?

Simple interest is essentially the interest charged to a borrower or earned by a lender for a
full term of loan.
To determine the interest incurred or interest earned, the following formula is used:
I = Prt
where:
I – is the interest
P – is the principal amount
r – is the interest rate, in percentage
t – term or loan period, in years

Example 1:
Suppose you want to borrow money from your friend to buy a concert ticket of your
favorite KPOP group. You wanted to be in the front row seat and the cost of the ticket is
₱15,000. You and your friend agreed that the money is payable in 12 months with an
interest rate of 5%. How much is the total amount you have to pay to your friend at the
end of 12-month period?

Solution:
Given:
P = ₱15,000
r = 5 % or 0.05
t = 12 months or 1 year
Use the formula to solve for the interest, I = Prt

I = (₱15,000)(0.05)(1)
= ₱750
The total amount to be paid to your friend after 12 months is ₱15,750.

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What is Maturity Value, Future Value and Present Value for Simple Interest?
Maturity Value is the amount to be paid to the holder of a financial obligation at the
obligation’s maturity. Future Value, on the other hand, is the sum of which today’s investment
will grow by specific future date, when compounded at a given interest rate. Conversely, it can
also be defined as the sum on a specific future date that will result in today’s investment if
discounted at a given discount rate. Technically speaking, maturity value and future value are
the same. Future value is the term used for investments and deposits, while maturity vale is
used for insurance or bonds. Present Value is the value today for an amount of money in the
future.
The formula for future value is:
FV = P(1 + rt)

where:
FV – is the future value, (principal + interest)
I – is the interest
P – is the principal amount or present value
r – is the interest rate, in percentage
t – term or loan period, in years

Example 2:
How much money will you have after 4 years if you deposited ₱5,000 in a bank that
pays 2% simple interest?

Solution:
Given:
P = ₱5,000
r = 2 % or 0.02
t = 4 year
Use the formula to solve for the future value, FV = P(1 + rt)
FV = ₱5,000 [1 + (0.02)(4)]
FV = ₱5,400
The money you have deposited in the bank will become ₱5,400 after 4 years.

What is Compound Interest?

Compound Interest is similar to simple interest, only that the interest charged or earned
is being rolled-over and reinvested with a principal amount. In other words, the interest also
earns interest, not just the original principal amount. Therefore, the principal amount
constantly changes once the interest is added. The basic premise of compound interest is that
the depositor or investor will leave, and not withdraw, the savings and let it grow exponentially.
The formula for future value using compound interest is:
𝒓
FV = 𝑷(𝟏 + )𝒏𝒕
𝒏
where:
FV – is the future value, (principal + interest)
I – is the interest
P – is the principal amount or present value
r – is the interest rate, in percentage
t – term or loan period, in years
n – number of times in a year that compounding is applied

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Example 3.
Your parents placed ₱100,000 in a bank for a time deposit. The bank offers 5%
interest rate compounded twice a year. How much will the principal and interest be after
4 years?
Solution:
Given:
P = ₱100,000
r = 5 % or 0.05
t = 4 year
n=2
𝑟
To solve the principal and interest, use the formula for the future value, FV = 𝑃(1 + )𝑛𝑡
𝑛
0.05 (2)(4)
FV = ₱100,000(1 + )
2
FV = ₱100,000(1 + 0.025)8
FV = ₱100,000(1.025)8
FV = ₱121,840.29
After 4 years, your bank deposit will become ₱121,840.29.

What is Maturity Value, Future Value and Present Value for Compound Interest?
Present value of for compound interest is no different from the present value for simple
interest, except for the fact that the present value in the compound interest environment is
always lower than the present than the present value in the simple interest environment. This
means you only invest less amount of money to earn a target future value in the future.
𝑭𝒖𝒕𝒖𝒓𝒆 𝑽𝒂𝒍𝒖𝒆
P= 𝒓
(𝟏+ )𝒏𝒕
𝒏

where:
P – is the principal amount or present value
FV – is the future value, (principal + interest)
I – is the interest
r – is the interest rate, in percentage
t – term or loan period, in years
n – number of times in a year that compounding is applied
Example 4.
How much money should a student place in a time deposit in a bank that pays 1.1%
compounded annually so that he will have ₱200,000 after 6 years?
Solution:
Given:
FV = ₱200,000
r = 1.1 % or 0.011
t = 6 year
n=1

𝑭𝒖𝒕𝒖𝒓𝒆 𝑽𝒂𝒍𝒖𝒆
To solve the present value, use the formula for the present value, P = 𝒓 .
(𝟏+ 𝒏)𝒏𝒕

𝐹𝑉
P= 𝑟
(1+ 𝑛)𝑛𝑡

₱200,000
P= 0.011 (1)(6)
(1+ )
1

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 ₱200,000
P=
(1.011)6

P = ₱187,293.65

The student should deposit P = ₱187,293.65 in the bank.

Practice Exercises/Activity
Complete the table by supplying the unknown data.

A. Simple Interest
Present Value Rate Term Interest Maturity Value
₱2,000 5% 3 years (1) (2)

(3) 12% 5 years ₱20,000 (4)

₱500,000 9.5% (5) ₱285,000 (6)

₱5,000 (7) 6 months (8) ₱6,000

(9) 12% 5 years (10) ₱400,000

B. Compound Interest

Present Value Rate Term Interest Maturity Value

₱6,000 8% 12 years (1) (2)

₱12,000 5.5% 5 yrs, 9 mos (3) (4)

₱60,000 9.75% 10 month (5) (6)

(7) 1% 6 years (8) ₱25,000

(9) 7.5% 4 yrs, 6 mos (10) ₱400,000

Engage (What I Learned/Generalizations)

This activity will enable you to reflect about the topic and activities you underwent. Reflect on
the activities you have done by wring a short paragraph. Write your answers on your journal
notebook. The beginning sentences are as follows:
I learned that _____________________________________________________________
_______________________________________________________________________________________________
_______________________________________________________________________________________.
I discovered that __________________________________________________________
_______________________________________________________________________________________________
_______________________________________________________________________________________.

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 I was surprised that I _____________________________________________________
_______________________________________________________________________________________________
_______________________________________________________________________________________.
I was pleased that I _______________________________________________________
_______________________________________________________________________________________________
_______________________________________________________________________________________.

Apply (What I Can Do)

A. Suppose you won ₱10,000.00 and you plan to invest it for 5 years. A cooperative group
offers 2% simple interest rate per year. A bank offers 2% compounded annually. Which
would you choose? Why?

B. How did your parents influence you in your saving and spending habits?

C. Make a flip chart of successful personalities who have applied good investment in
mathematics.

Post Test

Directions: Choose the letter that correspond the correct answer.

1. It is the amount paid or earned for the use of money.

interest c. lender
a. principal d. borrower
2. It is the date on which the money borrowed or loan is to be completely repaid.
a. maturity date c. rate
b. loan date d. time or term
3. It is a person who owes money or avail of funds from the lender.
a. debtor c. principal
b. creditor d. banker
4. It is the interest that is computed on the principal then added to it.
a. annuities c. compound interest
b. simple interest d. maturity value
5. It is the interest that is computed on the principal and also the accumulated past interest.
a. annuities c. compound interest
b. simple interest d. maturity value
6. It is the amount of time in years the money is borrowed or invested.
a. interest c. term
b. maturity d. value
7. It is a date on which money is received by the borrower.

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 a. term c. rate
b. loan date d. maturity date
8. It is the amount of money borrowed or invested on the origin date.
a. Principal c. Future Value
b. Interest d. Maturity Value
9. It is charged by the lender, or rate of increase of the investment.
a. Rate c. principal
b. Period d. interest
For items 10-12:
A bank offers 0.25% annual simple interest for a deposit. If you deposit ₱500,000.00, how
much interest will be earned from your savings account for 2 years?

10. The rate of interest is

a. 0.25% c. simple interest
b. 2 years d. ₱500,000.00
11. The term is
a. 0.25% c. simple interest
b. 2 years d. ₱500,000.00
12. The interest is
a. ₱250.00 c. ₱25,000.00
b. ₱2,500.00 d. ₱250,000.00

For items 13-14:

Your family is going to start a business and decided to borrow ₱200,000.00 from a bank at
0.5% compounded semi-annually. How much will your family be paying after 2 years?

13. The unknown value is

a. principal c. interest rate
b. interest d. maturity value
14. After 2 years, the family is paying
a. ₱2,000.00 c. ₱202,000.00
b. ₱2,007.50 d. ₱202,007.50
15. Your father purchased a ₱40,000 worth of cellular phone through his credit card. After a
month, he discovered from his statement of account that he was charged with ₱500
interest. How much was the monthly interest rate applied to his credit card purchase?
a. 1.25% c. 1.75%
b. 1.50% d. 2.25%

Address: Purok 4, Barangay Payao, Catbalogan City, Samar

Email: depedcatbalogancitydivision15@gmail.com
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