To complete the problems below, You MUST:

a. Drawa time line.

b.Write the identity of the typeof TVM problem you are looking at.Use the following identifications:

PVLS,PVA, FVLS, FVA, PVA Payments, orFVA Payments.

c. ShowSTEP-BY-STEPhow you are calculating your answers using the format below. I will deduct points this step is not included (see below for format).To solve your problems you can use EXCEL to solve, BUT you must set up the problem using the format below

d.Label your factor from the Tableswith thecorrect rate and time period(make sure your rate and period correspond to the time frame in the problem).See below.

REQUIRED FORMAT example:

Question:How much do I deposit each month if I want $10,000 in 5 years at 6%?

YOUR written ANSWER would be the following:

a. Your timeline

b. Problem Type: FVA PMT

c. Solution:

$10,000 x FVA factor (6%/12, 5*12) = FVA answer

$10,000 x 69.77 = $143.33

HomeworkProblems:

1.Stan deposits $600 each year for 10 years earning 4%. How much would he have at the end of the 10 years?

0 1 2 3 4 .............. 10

2.Linda wants $8,000 in 5 years.How much must she save eachmonthif the account were to earn 9%?(Note: you cannot divide your answer to #3 by 12).

0 12345

3.Bob wants to get a loan of $8,000. If the rate is 6% and term is 5 years, what would hismonthlypayments be?Remember the relationship between when you get the money from a loan and when payments are made.

4.Tim wants to go to travel around the world for the next 4 years.He believes he will need $36,000/yearto live on.He wants to know how much money he must have in his account now to be able to fund his travels.Assume the money will earn 4%.

5.Refer to problem #4. What would your answer be if the rate were 18%?

6.Based on your answers from #5 and #4, on sentence: The higher the interest rate, the __________ the present value.

WHY is thisanswer to this question BELOW your answer to this question.Your answer is important to remember - it is an important characteristic of rates in TVMand comes up later in later chapters.

7.Suzie wants to save $300 every 6 months (semi-annually) for the next 10 years.How much will she have if the interest rate is 8%?

8.Your great Aunt loves you a lot and wants to give you some money.The only thing is that she loves finance and so, naturally, always makes it a bit of a challenge to get her money.She promises to pay you the following cashflow: $1500 in 1 year,$2,600 in year 2 and $3,000 in year 3.You have to tell her how much she must set aside in an account to meet those cash payments.Assume a 10% rate.

9.Betty's friend want to also give you some money but has another TVM problem for you:She will give you $200 every 3 months for 10 years AND in addition tothe last $200 payment she will also give $10,000 to you (in year 10).Her question is how much does she have to set aside today in order to meet this cash flow.Assume a rate of 12%(Hint this has TWO TVM cash flows in it.Solve each separately and, since your answer will be in the same time period, add the two values up for a final answer).

10.You are going to borrow $100,000 for a home loan for 10 years.If the payments are $1,801.85/month,what is the interest rate on this loan (remember all rates are always quoted as annual equivalents)? Hint: set up timeline and determine which type of TVM problem it resembles and use that to solve with the same formula you used for all of the problems above.The only thing different here is the unknown is now the factor.