5. Use the calculator and Excel to answer the following: a. You want to become a millionaire (reaching 1 million dollars!). You want to know how long it will take you to get there if you plan on saving $1,250 monthly, and the current annual rate is 12%. (It will take you less than you think...) i. Formula n = log (FV/PV) / log (1 + r) ii. Estimate it in your Calculator: Write the keys you enter iii. Excel: Write the formula and arguments in Excel format. b. Your grandfather gave you $25,000 as a graduation gift. If you invest that money earning 9% per year, how much will you have in 10 years? iv. Formula: Plug in the values in the formula v. Calculator: Write the keys you enter vi. Excel: Write the formula and arguments in Excel format. c. What would you pay today for a piece of paper that promises you to get $67,000 in 12 years if the current discount rate is 9 percent? vii. Formula: viii. Calculator: Write the keys you enter ix. Excel: Write the formula and arguments in Excel format.

5. Use the calculator and Excel to answer the following: a. You want to become a millionaire (reaching 1 million dollars!). You want to know how long it will take you to get there if you plan on saving $1,250 monthly, and the current annual rate is 12%. (It will take you less than you think...) i. Formula n = log (FV/PV) / log (1 + r) ii. Estimate it in your Calculator: Write the keys you enter iii. Excel: Write the formula and arguments in Excel format. b. Your grandfather gave you $25,000 as a graduation gift. If you invest that money earning 9% per year, how much will you have in 10 years? iv. Formula: Plug in the values in the formula v. Calculator: Write the keys you enter vi. Excel: Write the formula and arguments in Excel format. c. What would you pay today for a piece of paper that promises you to get $67,000 in 12 years if the current discount rate is 9 percent? vii. Formula: viii. Calculator: Write the keys you enter ix. Excel: Write the formula and arguments in Excel format.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Vala
Suppose that you are planning to buy a boat in in 28 years [cell B3] for $100,000 [cell B2], and you deposit into your account the amount of $26,000 CAD [cell B1]. (a) What average annually compounding rate of return (as a percentage, correct to 2 decimals) should you earn so you can accumulate the lump sum needed to achieve your goal [cell B5]? Use the RATE function.(Note: You might have to modify the format of cell B5 so that it shows 2 decimals.) (b) What is the correct formula (using 18 characters or less) that should be placed in cell B5?Note: There are to be NO numbers in the function call (apart from a 0 if appropriate), only cell references, or negative cell references where appropriate. In excel pls.
d. If, instead, you decide to withdraw $170000 per year in retirement (again with the first withdrawal one year after retiring), how many years will it take until you exhaust your savings? (Use trial-and-error, a financial calculator: solve for "N", or Excel: function NPER) e. Assuming the most you can afford to save is $1500 per year, but you want to retire with 1000000 in your investment account, how high of a return do you need to earn on your investments? (Use trial-and-error, a financial calculator: solve for the interest rate, or Excel: function RATE) *round to two decimal places for d) and e)*
(Use Calculator or Formula Approach) Suppose you need $15,000 in 3 years . If you can earn 6% annually, how much do you need to invest today? If you could invest the money at 8%, would you have to invest more or less than at 6%? How much?0
(Use Calculator or Formula Approach) Suppose you need $15,000 in 3 years . If you can earn 6% annually, how much do you need to invest today? If you could invest the money at 8%, would you have to invest more or less than at 6%? How much?
You invest $5000 at time t=0 and an additional $2000 at time t=1/2. At time t=1/2 you have $5300 in your account and at time t=1 you have $7300 in your account. Find the dollar-weighted rate of return rd and the time-weighted rate of return rt on this investment.A. rd= 2.86 %, rt=3.43 %B. rd= 2 %, rt=2.4 %C. rd= 6.26 %, rt=7.5 %D. rd= 2.51 %, rt=3 %E. rd= 5.01 %, rt= 6 % Please answer it only correct without using Excel
Assume you can earn 12% per year on your investments. a. If you invest $60,000 for retirement at age 30, how much will you have 35 years later for retirement? b. If you wait until age 40 to invest the $60,000, how much will you have 25 years later for retirement? c. Why is the difference so large? * for a and b use the formula FVn = C × (1+r)^n
Please solve question 3, thanks
Assume that the price of real estate is determined by P=PV(all cash flows generated by the real estate). After you have graduated you work for some years and can save some money. You decide to invest in a house which you want to rent out for a rate of 12,000 pound per month. Assume that the rental rate will increase with 1.2% per year (which is 0.1% per month). (For the sake of simplicity, also assume that there are no further costs involved e.g. renovating or repair). a) As the market risk of renting out the house is low, you think that a discount rate of 5.5% (APR with monthly compounding) would be appropriate. What is the price of the house under the assumption that the cash flows from rent will last forever? b) If discount rate is 1% lower than 5.5% what is the price of the house? c) You want to make the valuation of the house more realistic by assuming that the time horizon for the valuation should be 50 years. Again, you assume that the house will generate SEK 12,000 rental…
To get the answer Step 1 plug everything using n=30 and you will have 0 for fv. Solve for pv Step 2 n= 2 and wte u got for pv in stdp 1 will go into fv. Pmt will be 0. Solve for pv
For the following economic calculations, write the factors (multipliers) that should be used,in (i) using the parameter values, and in (ii) calculate the result by showing your computations. Write the results you find in the spaces left. (Use factors for your calculations.)EXAMPLE: If you deposit $ 100 to a bank account that earns 8% annual interest, how much money will you have in this account after five years?(i)(F/P, 8%, 5) (ii)146.93100 * (F/P, 8%, 5) = 100 * 1.4693 = 146.93 TLa. You plan to take a credit with $1500 installment size per year with an annual interest rate of 8% over six years from a bank. What is the amount of your current credit?(i) (ii)b. A bank is required to deposit money for four years with an interest rate 10%. The money deposited at the end of the first year is 6000 TL and the amount of money deposited in the next three years will be reduced by 500 TL every year. How much money will be in the bank at the end of the fourth year?(i) (ii)
You are currently investing your money in a bank account which has a nominal annual rate of 7 percent, compounded monthly. How many years will it take for you to double your money? Identify the following variables to help solve problem: m Nper (or N) =n*m Rate (or I/Y)=i/m PV PMT FV

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