Need help filling out the finance workheets attached.

Adapted by Robert Timmons, D.B.A. 2010 - 2015 Managerial Finance BUS 8003 Chapter 4 Selected Problems 2-26 Printer Friendly NOTE: The problem numbers on the following worksheets correspond with the same End-of-Chapter problems of Essentials of Corporate Finance, 8th Edition. Adapted and Modified from Essentials of Corporate Finance (Ross, Westerfiled & Jordan) 8th Edition Robert Timmons, D.B.A - Revised July, 2015 Chapter 4 8e For helpful information on these types of problems see the provided Excel file Essentials_8e_Chapter_04_Excel_Master.xlsx (prepared by the text publisher), and the Excel Master It! Problem on page 121. Note: Use your text and provided resources! See Problem details beginning page 118 See Key Equations used beginning page 614 See Excel examples "Supplemental Text Provided Worksheet 8e.xlsx" See selected problem solutions beginning page 617 Questions 2 - 46 Question 2 Revised 03/2013 Revised 08/2016 $ Present value 3,150 8,453 89,305 227,382 Years 6 19 13 21 fx FV Future value Interest rate 13% 7% 9% 5% Incorrect Incorrect Incorrect Incorrect Question 4 Input area: Present value $ 715 905 15,000 70,300 Output area: Years fx RATE Interest rate 9 6 21 18 $ Future value 1,381 1,718 141,832 312,815 Incorrect Incorrect Incorrect Incorrect Question 6 Input area: $ Present value 45,000 Output area: Years Interest rate Future value 18 $ 280,000 Incorrect Question 8 Present value Beginning Year Ending Year $ 1.00 1880 2011 fx RATE Interest rate Future Value ### $ 13,113.00 Incorrect Question 10 Present value fx PV Years Interest rate Future value 25 6% $ 675,000,000 Incorrect Years Interest rate 106 6.10% Incorrect Question 12 Present value $ 50 Future value Question 14 $ Present value 0.10 Years Interest rate Future value 73 $ 2,161,000 Incorrect Years Interest rate Future value 20 $ 100.00 10 0.60% 10 $ 100.00 Incorrect Incorrect Incorrect Years Interest rate 45 10.10% 35 10.10% Incorrect Incorrect Question 16 a. $ b. $ c. $ Present value 50.00 50.00 - Question 18 $ $ Present value 5,000 5,000 Future value Question 20 Present value fx LN *Years Interest rate Future value $ 25,000 9% $ 150,000 Incorrect # of years to wait = "Years" is found by using the natural Logarithm of a number fx. - or - "Years" is found by using the Nper f Incorrect Question 22 Present value $ 1 Periods Interest rate Future value 8 $ 3 Incorrect Months Interest rate Future value 120 0.57% $ 75,000 Incorrect Question 24 Present value Question 26 Deposit $ 20,000 # of years 40 Interest rate for first 7% Interest rate for seco 11% Value at end of 1st p Incorrect Future value Incorrect If rates are swapped: Value at end of 1st p Future value Incorrect $ - Incorrect Attention: Tests (and/or quizzes) in Managerial Finance WILL NOT include the CORRECT / INCORRECT indicators. Therefore, your goal should not be to merely arrive a solution that moves the indictor from INCORRRECT to CORRECT but to know how you arrived at the correct solution. The End Adapted by Robert Timmons, D.B.A. 2010 - 2015 Managerial Finance BUS 8003 Chapter 5 Selected Problems 2 - 60 Printer Friendly NOTE: The problem numbers on the following worksheets correspond with the same End-of-Chapter problems of Essentials of Corporate Finance, 8th Edition. Adapted and Modified from Essentials of Corporate Finance (Ross, Westerfiled & Jordan) 8th Edition Robert Timmons, D.B.A - Revised July, 2015 Chapter 5 8e Note: Use your text and provided resources! See Problem details beginning page 155 Selected Questions 2 - 60 See Key Equations used beginning page 614 See Excel examples "Supplemental Text Provided Worksheet 8e.xlsx" See selected problem solutions beginning page 617 Revised 03/2013 Revised 09/2016 Question 2 Payment for X $ # of years for X 3,700 9 Payment for Y $ # of years for Y 5,500 5 Discount rate Discount rate For helpful information on these types of problems see the provided Excel file Essentials_8e_Chapter_05_Excel_Master.xlsx (prepared by the text publisher), and the Excel Master It! Problem on page 164. 6% 22% Output area: fx PV PV at 6% Value of X Value of Y Incorrect Incorrect PV at 22% Value of X Value of Y Incorrect Incorrect Question 4 Payment per year $ 6,700 # of years Required rate of return # of years # of years 15 8% 40 75 fx PMT Value today for 15 years payments Incorrect Value today for 40 years payments Incorrect Value today for 75 years payments Incorrect Value today of perpetuity Incorrect Difference in perpetuity and annuity of 75 years See calculation of Peretuity p. 139 Incorrect and special note at #10-11 Question 5 OMIT the Annuity Factor as stated in the text fx PV (of $1) fx PMT Present Value Years Interest Rate Annuity Factor Annuity Payment $ 36,800 6 11% 27,500 8 7% 145,000 15 8% 215,000 20 6% Note: Annuity Factor should be calculated out to five digits right of the decimal. Annuity Annuity Factor Payment Incorrect Incorrect Incorrect Incorrect Question 6 fx PV Annuity Payment $ 2,100 1,095 11,000 30,000 Years 7 9 18 28 Interest rate 8% 7% 9% 11% Present value Incorrect Incorrect Incorrect Incorrect Question 10 - 11 Perpertuity payment Interest rate $ Cost of policy $ 25,000 6% See calculation of Perpertuity p. 139 Also see the video in Student Resources titled Perpetuities (2 min.) 450,000 You Tube link: http://www.youtube.com/watch? v=GQmEP40uPpE Present value Incorrect Required interest rate Incorrect Question 12 Stated rate (APR) 10% 17% 13% 9% # of times per year 4 12 365 2 fx EFFECT Effective rate Incorrect Incorrect Incorrect Incorrect Question 13 fx NOMINAL Stated rate (APR) # of times per year 2 12 52 365 Effective rate 14% 9% 8% 13% Incorrect Incorrect Incorrect Incorrect Question 20 Amount borrowed $ 68,500 APR 5.9% # of years 5 # of times compounded per year 12 Note: Annuity Factor should be calculated out to five digits right of the decimal. See p. 132-133 fx PV Annuity factor (single year) Omit Calculate the Loan payment and rate using fx fx PMT Loan payment Incorrect fx EFFECT Effective interest rate Incorrect Question 21 Monthly payment Discount rate Current balance $ 500 1.4% $ 17,340 "Months" is found by using the natural Logarithm of a number fx. fx LN Example: =LN(A/B) / LN(X/Z) # of months until paid off Incorrect fx Nper Returns the natural logarithm of a number. Natural logarithms are based on the constant e (2.71828182845904). LN(1/(1-((Current Balance*Discount Rate)/Monthly Payment)))/LN(1+Discount Rate) Question 29 Interest rate per quarter # of years -or- use =NPER(rate,monthly pmt,-current balance,0) 6% 10 First Complex Bank interest rate Incorrect Question 30 Loan amount Loan length (months) APR on loan $ 52,500 60 6.25% fx PMT Annuity payment Incorrect Question 32 Cost of house Yield on CD Initial investment First Bank $ 195,000 5.5% $ 85,000 Incorrect Years Number of months at Second bank Second Bank Years fx NPER Incorrect Incorrect See "annuity due" Question 34 Internationalizing the curriculum! Amount invested Annual cash flow Number of years of payment 440 60 31 fx RATE Interest rate Incorrect Question 40 Price of sailboat Monthly payment Number of months $ 85,000 $ 1,800 60 fx RATE Maximum monthly rate Incorrect APR Incorrect Questions 55 - 56 (55) Loan amount Interest rate Loan term $ 75,000 8% 3 (55) Loan payment Year 1 2 3 fx PMT Incorrect Beginning balance Total payment Interest paid (56) Loan amount Interest rate Loan term Loan payment Year 1 2 3 Ending balance Incorrect Incorrect Correct Total interest paid over life of loan (56) Principal paid Incorrect $ 75,000 8% 3 $ 25,000 Beginning balance Total payment Interest paid Principal paid Ending balance Incorrect Incorrect Correct Total interest paid over life of loan Incorrect Question 60 Year 1 2 3 4 Payment $ 800 $ 800 $ 900 $ 900 5 6 # of years until retirement Payout at retirement $ $ $ 1,000 1,000 65 350,000 Interest rate 1 # of years 10% 6 Interest rate 2 # of years 7% 59 fx FV Year 1 2 The task here is to establish the value 3 of each year's 4 payment AT YEAR six. 5 6 Total value at year 6 Value at Year 6 Incorrect Incorrect Incorrect Incorrect Incorrect Incorrect Incorrect Total value at year 65 Incorrect You should buy the policy. The FV of the policy is more than the FV of the cost. The FV of the first $800. Hint: At year 6, the Year 1 payment has not been invested for 6 years. The FV of the second $800 invested for X years. etc., etc., etc. The cum. value then sits and gains interest for 59 years. This message may change based on your solution in cell F285 We should also compare the PV of the two cash flows. If we compare the PV: fx NPV Value of deposits Value of payment from insurance company Incorrect If one wanted to make one payment instead of six Incorrect PV(Interest Rate 2, # of years, 0, -Payout at retirement) / ((1 + Interest Rate #1) 6) fx PV