FIN 370 Week 2 Cash Flow Problem Sets Complete the following problem sets from Chapter 5 in Microsoft ® Excel ® :
· 5-1
· 5-3
· 5-5
· 5-7
· 5-12
· 5-15
· 5-39 ( Calculate monthly payment only )
5-1FutureValue Compute the future value in year 9 of a $ 2,000 deposit in year 1 and another $ 1,500 deposit at the end of year 3 using a 10 percent interest rate .
5-3 Future Value of an Annuity What is the future value of a $ 900 annuity payment over five years if interest rates are 8 percent ? 5-5 Present Value Compute the present value of a $ 2,000 deposit in year 1 and another $ 1,500 deposit at the end of year 3 if interest rates are 10 percent . 5-7 Present Value of an Annuity What ’ s the present value of a $ 900 annuity payment over five years if interest rates are 8 percent ? 5-12 Present Value of an Annuity Due If the present value of an ordinary , 6-year annuity is $ 8,500 and interest rates are 9.5 percent , what ’ s the present value of the same annuity due ? 5-15Effective Annual Rate A loan is offered with monthly payments and a 10 percent APR . What ’ s the loan ’ s effective annual rate ( EAR )? 5-39 Loan Payments You wish to buy a $ 25,000 car . The dealer offers you a 4-year loan with a 9 percent APR . What are the monthly payments ? How would the payment differ if you paid interest only ? What would the consequences of such a decision be ? -----------------------------------------------------------------------