Question
1. Assume that you deposit $1,000 at the beginning of each year into an account earning 2% interest. [1.25 points] A. How much will you
1. Assume that you deposit $1,000 at the beginning of each year into an account earning 2% interest. [1.25 points]
A. How much will you have at the end of 5 years? [0.25 points]
B. If you instead deposit the money at the end of each year, how much will you have at the end of 5 years? [0.25 points]
***For questions C through E, assume beginning of year deposits (as in Part A).
C. Using a vertical data table, explore how your results vary when the interest rate changes from 1% to 10%. Intuitively explain why the variation makes sense. [Note: you can just write your answer in a cell and highlight the answer). [0.25 points]
D. Using a horizontal data table, explore how your results vary when your investment horizon changes from 1 to 10 years. Intuitively explain why the variation makes sense. [0.25 points]
E. Create a two-dimensional table showing how results change when the interest rate changes from 1% to 10% and the investment horizon changes from 1 to 10 years. [0.25 points]
I would like you to solve it in Excel (spreadsheet) and write the formula?
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