14 DETERMINE required rate of return RATE NPER Text: Continuing with question #13 above, you are told that the rate required is not predictable over a 10 year period. How many years would it take to achive the $75,000 goal at a more conservative rate of 8%. PMT PV FV TYPE Solution: GUESS 15 AMORTIZATION of a loan Text: Open the "Amortization of a loan" file on Blackboard. Change the following variables in the yellow cells: A. Loan Amount $ 540,000.00 Interest rate 4.25% Term 30.00 B New annual payment is: Total interest paid is: Now, change terms to monthly (stay in yellow are a). New monthly payment is: Total interest paid is: D Now, let's prepay in the amount of $200 monthly. To do this, go to cell 16 and manually enter your new monthly payment and add $200. New monthly payment is: Total interest paid is: Savings in interest is: New payoff in years is: 14 DETERMINE required rate of return RATE NPER Text: Continuing with question #13 above, you are told that the rate required is not predictable over a 10 year period. How many years would it take to achive the $75,000 goal at a more conservative rate of 8%. PMT PV FV TYPE Solution: GUESS 15 AMORTIZATION of a loan Text: Open the "Amortization of a loan" file on Blackboard. Change the following variables in the yellow cells: A. Loan Amount $ 540,000.00 Interest rate 4.25% Term 30.00 B New annual payment is: Total interest paid is: Now, change terms to monthly (stay in yellow are a). New monthly payment is: Total interest paid is: D Now, let's prepay in the amount of $200 monthly. To do this, go to cell 16 and manually enter your new monthly payment and add $200. New monthly payment is: Total interest paid is: Savings in interest is: New payoff in years is