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I am needing to work these out in Excel but I cannot figure out the formulas on Excel for them. Could you please assist? Annuities
I am needing to work these out in Excel but I cannot figure out the formulas on Excel for them. Could you please assist?
Annuities with Intraperiod Compounding
- Example 3.14: Suppose you set aside $250 at the end of every three months toward your future retirement, planned forty years from today, at an 8% interest rate. What is the future ending value of your investment?
Basic Loan Calculations
- Example 3.15: The Texas lottery example continued.
Suppose you want to open a microbrewery business and need $4,250,000. You have a lender willing to advance you the funds with your future lottery cash flows as collateral. The lender requires 10% interest rate with annual payments over the next twenty years.
- How much will your payments be?
- Build an amortization schedule for the microbrewery business example.
- For the lotterybacked microbrewery loan, what is the loan balance after five years?
- What interest amount was paid for that fifth year? That is, what was the amount paid to the interest within year 5?
- What is the total interest paid over the life of the loan?
Finding Interest Rates and Number of Periods
- Example 3.16: If the future value of an ordinary annuity is $5,751, the annual payment is $1,000, and the time period is five years. What is the interest rate for this annuity?
- Example 3.17: If the future value of an ordinary annuity is $5,751, the annual payment is $1,000, and the interest rate is 7%. How long would it take for your $1,000 annual investments to grow to $5,751?
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