FIN 419 Expect Success/uophelp.com FIN 419 Expect Success/uophelp.com | Page 13

This Tutorial comes with a excel sheet
P3-1
Future Value. Fill in the future values for the following table using
one of the three methods below:
a.
Use the future value formula, FV = PV*(1+r)n.
b. Use the TVM keys from a calculor.
c.
Use the TVM function in a spreadsheet.
P3 – 4
Future Value. Grand opening Bank is offering a one-time
investment opportunity for its new customer. A customer opening
a new checking account can buy a special saving bond for $ 400
today , Which the bank will compound at 8.5% for the next ten
years. The savings bond must be held for at least five years, but can
then be cashed in at end of any year starting with years five. What
is the value of the bond at each cash-in date up through year ten ?
What is the value of the savings bond at the end of year five ?
a.
What is the value of the savings bond at the end of year
five ?
b. What is the value of the savings bond at the end of year
six?
c.
What is the value of the savings bond at the end of year
seven?
d. What is the value of the savings bond at the end of year
eight?
e.
What is the value of the savings bond at the end of year
nine?
f.
What is the value of the savings bond at the end of year
ten?
P 3– 8
a.
Use the present value formula, PV = FV*--b. Use the TVM keys from a calculator.
c.
Use the TVM function in a spreadsheet.
P3-15