5 (b) The Image P2.2 has the pricing structure for the Ohio datacenter for Linux "a1.4xlarge" server for Standard 3-Year Term.Assume that the monthly payments are done at the end of the month.Compute the monthly payments' present value and suggest whether the firm should opt for No Upfront or All upfront payment option. Hint: If the monthly payment's present value is more than the upfront payment, you should prefer the upfront payment option. Firm's annualised required rate of return is 10% pa. (i) Write formula in cell C19 to compute the monthly required rate of return.(ii) Enter the values of number of periods, Monthly payments and Type in cells C20, C21 and C23 respectively. (iii) Write a formula in cell C25 to compute the present value of the monthly paments.(iv) In cell C26, select your recommended payment option from the dropdown. 1314ABYour recommendation2021222324252627Annual Required RateMonthly Required RateNumber of periods (Nper)CAll UpfrontMonthly Payments (PMT)Future Value (FV)TypePresent Value (PV)Choose your recommendatioD10.000%E5 (b) The Image P2.2 has the pricing structure for the Ohio datacenter for Linux "a1.4xlarge" server for Standard 3-Year Term.Assume that the monthly payments are done at the end of the month.Compute the monthly payments' present value and suggest whether the firm should opt for No Upfront or All upfront payment option.15 Hint: If the monthly payment's present value is more than the upfront payment, you should prefer the upfront payment option.Firm's annualised required rate of return is 10% pa.(i) Write formula in cell C19 to compute the monthly required rate of return.(ii) Enter the values of number of periods, Monthly payments and Type in cells C20, C21 and C23 respectively.(iii) Write a formula in cell C25 to compute the present value of the monthly paments.16 (iv) In cell C26, select your recommended payment option from the dropdown.171819Select from the listAll UpfrontNo UpfrontImage P2.2Payment OptionAll UpfrontSTANDARD 3-YEAR TERMPartial UpfrontUpfrontF$2,102$0$2,144$4,032Monthly$128.70$0.00$59.57G$0.00Present Value (PV)HORPresent Value (PV)Correct Answer$3,988.57-$3,988.57J

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Answered: 5 (b) The Image P2.2 has the pricing…

Database System Concepts

7th Edition

ISBN:9780078022159

Author:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan

Publisher:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan

Chapter1: Introduction

Section: Chapter Questions

Problem 1PE

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5 (b) The Image P2.2 has the pricing structure for the Ohio datacenter for Linux "a1.4xlarge" server for Standard 3-Year Term.
Assume that the monthly payments are done at the end of the month.
Compute the monthly payments' present value and suggest whether the firm should opt for No Upfront or All upfront payment option.
Hint: If the monthly payment's present value is more than the upfront payment, you should prefer the upfront payment option.

Firm's annualised required rate of return is 10% pa.
(i) Write formula in cell C19 to compute the monthly required rate of return.
(ii) Enter the values of number of periods, Monthly payments and Type in cells C20, C21 and C23 respectively.
(iii) Write a formula in cell C25 to compute the present value of the monthly paments.
(iv) In cell C26, select your recommended payment option from the dropdown.

13
14
A
B
Your recommendation
20
21
22
23
24
25
26
27
Annual Required Rate
Monthly Required Rate
Number of periods (Nper)
C
All Upfront
Monthly Payments (PMT)
Future Value (FV)
Type
Present Value (PV)
Choose your recommendatio
D
10.000%
E
5 (b) The Image P2.2 has the pricing structure for the Ohio datacenter for Linux "a1.4xlarge" server for Standard 3-Year Term.
Assume that the monthly payments are done at the end of the month.
Compute the monthly payments' present value and suggest whether the firm should opt for No Upfront or All upfront payment option.
15 Hint: If the monthly payment's present value is more than the upfront payment, you should prefer the upfront payment option.
Firm's annualised required rate of return is 10% pa.
(i) Write formula in cell C19 to compute the monthly required rate of return.
(ii) Enter the values of number of periods, Monthly payments and Type in cells C20, C21 and C23 respectively.
(iii) Write a formula in cell C25 to compute the present value of the monthly paments.
16 (iv) In cell C26, select your recommended payment option from the dropdown.
17
18
19
Select from the list
All Upfront
No Upfront
Image P2.2
Payment Option
All Upfront
STANDARD 3-YEAR TERM
Partial Upfront
Upfront
F
$2,102
$0
$2,144
$4,032
Monthly
$128.70
$0.00
$59.57
G
$0.00
Present Value (PV)
H
OR
Present Value (PV)
Correct Answer
$3,988.57
-$3,988.57
J

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