1) On January 1, 20x2, ShadowIsle company has an opportunity to invest in an investment that need a cash outlay of Php4,000 every year starting January 1, 20x3 for 10 years, compounded quarterly. The prevailing interest rate for this kind of investment is 6% semi-annually. Compute the equal annual return? (Round your answer in 2 decimal places)

a. 3.25%

b. 6.12%

c.12.55%

d.12.25%

2) Bilgewater company have new securities that are for sale exclusively to Gangplank, Graves and Illaoi who is a controller, secretary of the president, and manager of the company, respectively. Which of the following best describes the illustration?

a. Bilgewater company made an initial public offering to its management

b. Bilgewater company made a Public Placement to its management

c. Bilgewater company made a private placement to its management

d. Bilgewater company made an initial private offering to its management

3) Which of the following least likely describes the meaning of Inflation?

a. Inflation rate is directly proportional with the cost of goods and services over a period of time.

b. Inflation rate is inversely proportional with the cost of goods and services over a period of time.

c. Both statements are correct

d. Both statements are incorrect

4) On January 1, 20x2, Noxus company has an opportunity to invest in an investment that need a cash outlay of Php40,000 that will earn interest for 10 years, compounded quarterly. The prevailing interest rate for this kind of investment is 8% annually. How much is the value of the investment on the end of 10 years? (Round your factor in 3 decimal places)

a. Php400,000

b. Php432,000

c. Php88,320

d. Php181,200

5) Senna, an investor, invested in a 5-year bond with 95 shares at Php950 par value that will be paid in equal annual installment and with a coupon rate of 7% that is paid semi-annually. The effective rate of the bond is 11%. What is the carrying value of the bond at investment date? (Use 8 decimal places for the present value factor)

a. Php136,054.15

b. Php81,506.87

c. Php68,977.11

d. Php68,135.58