Corporate Finance

Instructions: You are to solve all these problems in MS Excel and submit the excel sheets as answers. You are to solve the problems using formulae and additionally use Excel Functions to compute the answers. So you are going to have two answers on your excel sheet: one computed using formulas, the other computed through excel functions. Example: if you take an average of 5 numbers, you add them together and divide by 5 to calculate average. That's formula. You also use the Average() function on Excel to calculate the average. That way you can also double check your answers. 1.Calculate the compound (geometric) average return for the following 3 cashflows Year Cash flows A B C $500 $200 $2,000 2 $600 $300 $2,500 3 $800 $400 $2,600 $1,000 $500 $2,800 U $1,200 $600 $3,000 6 $700 $3,250 $800 8 $900 2. You are saving money for retirement. How much will you have on deposit in 40 years if you invest at 12% as follows, a. At the end of each of the next 8 years you deposit $2,000. After 8 years you do not make any more deposits, but the balance continues to compound at 12% for the next 32 years. b. Your first $2,000 deposit is made at the end of the eighth year and at the end of each subsequent year for the next 32 years. c. Find the Present Value of both a and b