Excel File
| Chapter 4-48 | ||||
| Calculating Present Values | ||||
| A five year annuity of 10 $6,500 semi annual payments will begin 9 years from now. | ||||
| The first payment is in 9.5 years. | ||||
| If the discount rate is 9% compounded monthly, what is the value of the annuity five years from now? | ||||
| What is the value three years from now? | ||||
| What is the current value? | ||||
| Payments | 6500 | |||
| #paymnet | 10 | |||
| r | 9% | |||
| Monthly rate | 0.0075 | =D13/12 | ||
| Semi Annual | 0.04585224 | =((1+D15)^6)-1 | ||
| PV (t9) | $51,217.83 | =PV(D16,D12,-D11) | ||
| PV (t5) | $40,932.62 | =PV(D16,5,,-D18) | ||
| EAR | 0.0938069 | =((1+D15)^12)-1 | ||
| EAR | 0.0938069 | =EFFECT(D13,12) | ||
| PV (t3) | $29,907.30 | =D18/(1+D21)^6 | ||
| PV (t0) | $34,212.77 | =D18/(1+D16)^9 | ||
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