1. PNB pays 6% interest compounded semi-annually. BPI pays 6% compounded monthly. Which bank offers the higher effective annual rate?

2. Compute the present value and future value of PHP100 cash flow for the following combination of discount rates and times:

a. r = 8%, t = 5 years

b. r = 8%, t = 10years

c. r = 5%, t = 5years

d. r = 5%, t = 10 years

3. LYNDY deposit PHP1,000 in her bank account. If the bank pays 4% simple interest, how much interest will accumulate in LYNDYs account after 10 years? What if the bank pays compound interest?