Expert answer:Time Value of money calculations
Expert answer:Solve problems . Please show your work in the cells. Use Excel formulas instead of writing the values/answers directly in the cell.
timevalue.xlsx
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Instructions
1. You have five problems – one on each tab of this Excel file.
2. Please show your work in the cells. Use Excel formulas instead of writing the values/answers directly in the cell.
The instructor will then know where you made a mistake and provide you valuable feedback and partial credit (if
3. It is recommended to watch the assigned videos in week # 2.
Total Points: 8
e feedback and partial credit (if appropriate).
If we place $8,592.00 in a savings account paying 7.5 percent interest compounded annually, how much will our acco
FV = PV × (1 + i)n
Present Value (PV)
Interest Rate (i)
Number of years (n)
8592
0.075
9.5
Answer-
Refer to the Solved Example 2 on Page 49 of your text.
how much will our account accrue to in 9.5 years?
What is the present value of $992 to be received in 13.5 years from today if our discount rate is 3.5 percent?
Future Value (FV)
Interest Rate (i)
Number of years (n)
992
0.035
13.5
Answer-
Refer to the Solved Example 5 on Page 52 of your text.
is 3.5 percent?
If you bought a stock for $45 dollars and could sell it fifteen years later for three times what you originally paid. Wha
Future Value (FV)
Present Value (PV)
Number of years (n)
135
45
15
Answer-
Refer to the Solved Example 6 on Page 53 of your text.
ou originally paid. What was your return on owning this stock?
Suppose you bought a house for $3,250,000 to make it a nursing home in the future. But you have not committed to t
If real estate values increase annually at 1.5%, how much can you expect to sell the house for in nine years if it choos
FV = PV × (1 + i)n
Present Value (PV)
Interest Rate (i)
Number of years (n)
3250000
0.015
9
Answer-
Refer to the Solved Example 2 on Page 49 of your text.
have not committed to the project and will decide in nine years whether to go forward with it or sell off the house.
ell off the house.
If your daughter wants to earn $215,000 within the next twenty-three years and the salaries grow at 4.45% per year. W
Future Value (FV)
Interest Rate (i)
Number of years (n)
215000
0.0445
23
Answer-
Refer to the Solved Example 5 on Page 52 of your text.
ow at 4.45% per year. What salary should she start to reach her goal?
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