This is our study guide and I would like to know step by step how to solve these questions on excel/ or by hand whichever is easier. Along with knowing why took that route in order to be knowledgable on the material for my exam thursday.

6_____You borrowed $28,000 from the bank at 7.25%. This loan is to be paid back over eight years, with payments made at the end of each year. Over the life of the loan, how much have you paid in interest? a $42,612 b $37,877 c $ 9,877 d $ 4,315 7_____You make a $4,500 investment that gives you a cash flow of $700 in year one, $850 in year two, $1,800 in year three, and $1,975 in year four. What annual rate of return has your investment generated? Assume all cash flows are received at the end of each year and no terminal value. a 3.22% b 5.94% c 6.15% d 7.40% 8_____What is the present value of an annuity due that pays you $1,200 per year for the next 16 years? Assume no terminal value and a discount rate of 7%. a $11,336 b $12,130 c $ 9,334 d $ 7,726 9____What is the effective rate of interest on a savings account that pays you 8% compounded monthly? a 9.50% b 8.30% c 8.00% d 6.70% 10 ____You make a $60,000 investment today, and your portfolio produced a 10% return (compounded monthly). If you were to take $550 out of this account at the end of each month, how much would be in the account at the end of twenty years? a $ 857,337 b $ 322,545 c $ 22,032 d $ 18,551 1_____You have an opportunity to make an investment today that you estimate will generate a cash flow of $3,500 in year one, $2,100 in year two and $12,500 in year three. Assume all cash flows will occur at the end of each year and that the investment will have no value after year three. If you feel the appropriate rate of return on this investment is 18%, how large of an investment are you willing to make today in order to generate these cash flows? a $18,100 b $14,257 c $12,082 d $10,986 2_____You make a $20,000 investment that gives you a cash flow of $1,900 in year one, $1,200 in year two, $5,800 in year three, and $18,500 in year four. What annual rate of return has your investment generated? Assume all cash flows are received at the end of each year and no terminal value. e 9.53% f 8.46% g 7.15% h 6.43% 3 _____What is the present value of an annuity due that pays you $5,000 per month for the next 40 years? Assume no terminal value and a discount rate of 8%. e $719,102 f $723,896 g $750,222 h $786,315 4_____What is the effective rate of interest on a loan that charges you 9% compounded monthly? e 9.98% f 9.38% g 9.00% h 8.74% 7_____You invest $100,000 today at a rate of 5.6%. You take $800 a month out of your account and spend it. How much will you have in your account in 10 years? a $46,543 b $96,596 c $112,936 d $303,135 8_____You have $50,000 to invest today. You hope to have $2,000,000 in forty years. If you do not plan on making any additional investments, what annual rate of return will you have to achieve on your investment to reach your goal? a 9.66% b 13.59% c 18.21% d 21.45% 1_____You have an opportunity to make an investment today that you estimate will generate a cash flow of $1,500 in year one, $1,600 in year two and $2,500 in year three. Assume all cash flows will occur at the end of each year and that the investment will have no value after year three. If you feel the appropriate rate of return on this investment is 15%, how large of an investment are you willing to make today in order to generate these cash flows? e $5,600 f $4,782 g $4,158 h $3,992 2_____You make a $20,000 investment that gives you a cash flow of $1,900 in year one, $1,200 in year two, $5,800 in year three, and $18,500 in year four. What annual rate of return has your investment generated? Assume all cash flows are received at the end of each year and no terminal value. i 9.53% j 8.46% k 7.15% l 6.43% 3 _____What is the present value of an annuity due that pays you $5,000 per month for the next 25 years? Assume no terminal value and a discount rate of 5%. i $858,864 j $855,300 k $850,222 l $846,315 4_____What is the effective rate of interest on a savings account that pays you 3% compounded monthly? i 4.00% j 3.36% k 3.04% l 3.00% 5_____You make a $2,000 investment today and additional investments of $600 at the end of each quarter. If your portfolio produced a 12% return (compounded quarterly), what would it be worth after 40 years? e $6,247,433 f $4,522,521 g $2,471,028 h $1,170,392 6_____The process of finding the present value of a future cash flow or series of cash flows is known as a. reducing b. presenting c. discounting d. amortizing 7_____You invest $100,000 today at a rate of 5.6%. You take $800 a month out of your account and spend it. How much will you have in your account in 10 years? e $46,543 f $96,596 g $112,936 h $303,135 8_____You have $50,000 to invest today. You hope to have $2,000,000 in forty years. If you do not plan on making any additional investments, what annual rate of return will you have to achieve on your investment to reach your goal? e 9.66% f 13.59% g 18.21% h 21.45%