Note That Interest Rates Are Always Given As Annual Rates If The Pa· Note that interest rates are always given as annual rates. If the payments are monthly, the

Note That Interest Rates Are Always Given As Annual Rates If The Pa ✓ Solved

· Note that interest rates are always given as annual rates. If the payments are monthly, then the annual interest rate needs to be divided by 12 in order to get the rate per month. Use monthly rates in your calculations when the payments are monthly. Similarly, if the payments are monthly, then N is the number of months (not the number of years). · It isn't clear in problem 5-54, but assume that monthly payments are made on the car loan. · Problem 5-58 has a typo in part a. Create a schedule for a 30-year loan (not 3-year).

Also, assume that monthly payments are made on the home loan. Word, or PDF file showing the answer and the supporting calculations. Clearly show your work with all steps included. If you are using mathematical formulas, write the formulas with all steps to get to the answer. If you are using a financial calculator, write out all the calculator keystrokes used.

If you are using Excel, submit the file with formulas and the data entered into the formula. Your work must be clearly visible Chapter 4 and 5 Problems and Solutions 4-12 Present Value Compute the present value of an 0 payment made in 10 years when the discount rate is 12 percent. PV=FV/ (1+i) N PV=0/ (1+0.12)10 =0 / 3.10585 =3. Comparing Cash Flows Which cash flow would you rather pay, 5 today or 0 in two years if interest rates are 10 percent? Why?

4-28 Moving Cash Flows What is the value in year 15 of a 0 cash flow made in year 3 if interest rates are 11 percent? 4-30 Solving for Rates what annual rate of return is earned on a ,000 investment when it grows to ,500 in five years? (LG Solving for Time How long will it take

Note That Interest Rates Are Always Given As Annual Rates If The Pa

If you are using Excel, submit the file with formulas and the data entered into the formula. Your work must be clearly visible Chapter 4 and 5 Problems and Solutions 4-12 Present Value Compute the present value of an $850 payment made in 10 years when the discount rate is 12 percent. PV=FV/ (1+i) N PV=$850/ (1+0.12)10 =$850 / 3.10585 =$273. Comparing Cash Flows Which cash flow would you rather pay, $425 today or $500 in two years if interest rates are 10 percent? Why?

4-28 Moving Cash Flows What is the value in year 15 of a $250 cash flow made in year 3 if interest rates are 11 percent? 4-30 Solving for Rates what annual rate of return is earned on a $5,000 investment when it grows to $9,500 in five years? (LG Solving for Time How long will it take $2,000 to reach $5,000 when it grows at 10 percent per year? FVN = PV X (1 = i) N $5000 = $2000 X (1 + 0.10) N (1.10)N = 5/2 (the thousands cancel) In (1.10) N = In 2.5 N x In 1.10 = In 2.5 N = In 2.5 / In 1.10 = 0.91629 / 0.09531 = 9.61 years = 9 years, 7.4 months 4-34 Future Value At age 25 you invest $1,500 that earns 8 percent each year. At age 40 you invest $1,500 that earns 11 percent per year. In which case would you have more money at age 65?

4-37 Solving for Rates what annual rate of return is earned on a $4,000 investment made in year 2 when it grows to $6,500 by the end of year 7? 4-41 Moving Cash Flows You are scheduled to receive a $500 cash flow in one year, a $1,000 cash flow in two years, and pay an $800 payment in three years. If interest rates are 10 percent per year, what is the combined present value of these cash flows? 5-4 Future Value of an Annuity what is the future value of a $700 annuity payment over six years if interest rates are 10 percent? 5-8 Present Value of an Annuity what’s the present value of a $700 annuity payment over six years if interest rates are 10 percent?

5-12 Present Value of an Annuity Due If the present value of an ordinary, six-year annuity is $8,500 and interest rates are 9.5 percent, what’s the present value of the same annuity due? 5-16 Effective Annual Rate A loan is offered with monthly payments and a 13 percent APR. What’s the loan’s effective annual rate? 5-20 Future Value of Multiple Annuities Assume that you contribute $150 per month to a retirement plan for 15 years. Then you are able to increase the contribution to $350 per month for the next 25 years.

Given an 8 percent interest rate, what is the value of your retirement plan after the 40 years? 5-26 Present Value You are looking to buy a car. You can afford $650 in monthly payments for five years. In addition to the loan, you can make a $750 down payment. If interest rates are 8 percent APR, what price of car can you afford?

5-28 Present Value of a Perpetuity A perpetuity pays $50 per year and interest rates are 9 percent. How much would its value change if interest rates decreased to 7.5 percent? Did the value increase or decrease? 5-34 Annuity Interest Rate What’s the interest rate of a seven-year, annual $4,000 annuity with present value of $20,000? 5-40 Loan Payments You wish to buy a $10,000 dining room set.

The furniture store offers you a three-year loan with an 11 percent APR. What are the monthly payments? How would the payment differ if you paid interest only? What would the consequences of such a decision be? 5-42 Number of Annuity Payments Phoebe realizes that she has charged too much on her credit card and has racked up $6,000 in debt.

If she can pay $200 each month and the card charges 18 percent APR (compounded monthly), how long will it take her to pay off the debt? 5-54 Loan Balance Hank purchased a $20,000 car two years ago using a 9 percent, five-year loan. He has decided that he would sell the car now, if he could get a price that would pay off the balance of his loan. What’s the minimum price Hank would need to receive for his car? 5-58 Spreadsheet Problem When paying off a home mortgage, extra principle payments can have a dramatic impact on the time needed to pay off the mortgage. (LG5-9) a.

Create an amortization schedule for a $200,000, thirty year mortgage, with a 6% APR. B. After the fifth Name: Date: Public Speaking Touchstone 1 Template Complete the following template, including all parts. Fill out all cells using complete sentences, aiming for one to three complete sentences for each cell of the template. Audience A1.

What is the correct context for the speech? Where and when will it be given? A2. Who is the audience and what are their characteristics? A3.

Why has the audience come to hear the speech? A4. What are the interests of the audience? A5. What does the audience know about your topic?

A6. What is the audience’s point of view on the topic? A7. How will the audience likely react to your speech? Purpose P1.

What do you want your audience to know? P2. What do you want your audience to think? P3. What do you want your audience to feel?

P4. What do you want your audience to do? Thesis T1. What is the most important message of your speech? T2.

Why should/will your audience care about your message? Reflection R1. Are your audience, purpose and thesis aligned? Why or why not? R2.

What did you learn from this experience? 1. Think about a special occasion speech that you would like to present on a topic of your choice. 2. The speech can be for any context and any length, but the purpose must be to commemorate an occasion.

See the list of example occasions for inspiration. 3. Download and answer each question in the Unit 1 Touchstone Template based on the speech you are thinking of: Touchstone1Template.doc 4. Consider your audience, purpose, and thesis. Answer each of the questions related to audience, purpose, and thesis.

Answer in detail, using complete sentences. 5. Review the rubric to ensure that you understand how you will be evaluated. Contact a Sophia learning coach with any questions. 6.

Review the checklist and requirements to ensure that your Touchstone is complete. 7. Submit your completed Unit 1 Touchstone Template on Sophia. Example Speech Occasions Personal · Speech at a graduation · Toast at a wedding or other party · Eulogy at a funeral Academic · Presenting an award for academic work (paper, research, report) · Accepting an award for original creative work Community · Speech at a community gathering (PTA meeting, boy/girl scout convention, town hall, homeowner’s association, athletic league, school board meeting, etc.) Business · Celebrating staff at a company retreat · Sharing a professional milestone Submission checklist _ I have completed all aspects of the template. _ I have answered each question using complete sentences. _ My answers demonstrate thoughtful consideration of each question. _ I have adhered to all of the length and formatting requirements. _ I have read through the rubric and I understand how my Touchstone will be evaluated. Requirements · Answer each question with 1 to 3 complete sentences · Your responses should be 300 to 500 words in total · All writing must be appropriate for an academic context · Follow academic writing conventions (correct grammar, spelling, punctuation, and formatting) · Composition must be original and written for this assignment; plagiarism of any kind is strictly prohibited · Use a readable 12-point font, double-spaced with 1-inch margins · Submission should include your name, the name of the course, the date, and the title of your composition · Submit a single file only, including the answers to all questions · Acceptable file formats include .doc and .docx.

,000 to reach ,000 when it grows at 10 percent per year? FVN = PV X (1 = i) N 00 = 00 X (1 + 0.10) N (1.10)N = 5/2 (the thousands cancel) In (1.10) N = In 2.5 N x In 1.10 = In 2.5 N = In 2.5 / In 1.10 = 0.91629 / 0.09531 = 9.61 years = 9 years, 7.4 months 4-34 Future Value At age 25 you invest ,500 that earns 8 percent each year. At age 40 you invest ,500 that earns 11 percent per year. In which case would you have more money at age 65?

4-37 Solving for Rates what annual rate of return is earned on a ,000 investment made in year 2 when it grows to ,500 by the end of year 7? 4-41 Moving Cash Flows You are scheduled to receive a 0 cash flow in one year, a ,000 cash flow in two years, and pay an 0 payment in three years. If interest rates are 10 percent per year, what is the combined present value of these cash flows? 5-4 Future Value of an Annuity what is the future value of a 0 annuity payment over six years if interest rates are 10 percent? 5-8 Present Value of an Annuity what’s the present value of a 0 annuity payment over six years if interest rates are 10 percent?

5-12 Present Value of an Annuity Due If the present value of an ordinary, six-year annuity is ,500 and interest rates are 9.5 percent, what’s the present value of the same annuity due? 5-16 Effective Annual Rate A loan is offered with monthly payments and a 13 percent APR. What’s the loan’s effective annual rate? 5-20 Future Value of Multiple Annuities Assume that you contribute 0 per month to a retirement plan for 15 years. Then you are able to increase the contribution to 0 per month for the next 25 years.

Given an 8 percent interest rate, what is the value of your retirement plan after the 40 years? 5-26 Present Value You are looking to buy a car. You can afford 0 in monthly payments for five years. In addition to the loan, you can make a 0 down payment. If interest rates are 8 percent APR, what price of car can you afford?

5-28 Present Value of a Perpetuity A perpetuity pays per year and interest rates are 9 percent. How much would its value change if interest rates decreased to 7.5 percent? Did the value increase or decrease? 5-34 Annuity Interest Rate What’s the interest rate of a seven-year, annual ,000 annuity with present value of ,000? 5-40 Loan Payments You wish to buy a ,000 dining room set.

If she can pay 0 each month and the card charges 18 percent APR (compounded monthly), how long will it take her to pay off the debt? 5-54 Loan Balance Hank purchased a ,000 car two years ago using a 9 percent, five-year loan. He has decided that he would sell the car now, if he could get a price that would pay off the balance of his loan. What’s the minimum price Hank would need to receive for his car? 5-58 Spreadsheet Problem When paying off a home mortgage, extra principle payments can have a dramatic impact on the time needed to pay off the mortgage. (LG5-9) a.

Create an amortization schedule for a 0,000, thirty year mortgage, with a 6% APR. B. After the fifth Name: Date: Public Speaking Touchstone 1 Template Complete the following template, including all parts. Fill out all cells using complete sentences, aiming for one to three complete sentences for each cell of the template. Audience A1.

What is the correct context for the speech? Where and when will it be given? A2. Who is the audience and what are their characteristics? A3.

Why has the audience come to hear the speech? A4. What are the interests of the audience? A5. What does the audience know about your topic?

A6. What is the audience’s point of view on the topic? A7. How will the audience likely react to your speech? Purpose P1.

What do you want your audience to know? P2. What do you want your audience to think? P3. What do you want your audience to feel?

P4. What do you want your audience to do? Thesis T1. What is the most important message of your speech? T2.

Why should/will your audience care about your message? Reflection R1. Are your audience, purpose and thesis aligned? Why or why not? R2.

Answer in detail, using complete sentences. 5. Review the rubric to ensure that you understand how you will be evaluated. Contact a Sophia learning coach with any questions. 6.

Paper for above instructions

Assignment Solutions: Financial Calculations and Present Value Concepts
When tackling financial problems, it is essential to understand the concepts of present value and future value, as well as how to calculate these values given certain parameters. Below is a comprehensive analysis of the assigned problems, calculations, and solutions.

Problem 4-12: Present Value Calculation

Question: Compute the present value of an 0 payment made in 10 years when the discount rate is 12 percent.
Solution:
The formula for present value (PV) is:
\[ PV = \frac{FV}{(1 + i)^N} \]
Where:
- $ FV = 850 $
- $ i = 0.12 $
- $ N = 10 $
Substituting these values into the equation:
\[
PV = \frac{850}{(1 + 0.12)^{10}}
\]
\[
PV = \frac{850}{(1.12)^{10}}
\]
\[
PV \approx \frac{850}{3.478}
\]
\[
PV \approx 244.51
\]
Conclusion: The present value of an 0 payment made in 10 years at a 12% discount rate is approximately 4.51.

Problem 4-28: Moving Cash Flows

Question: What is the value in year 15 of a 0 cash flow made in year 3 if interest rates are 11 percent?
Solution:
To find the future value (FV) in year 15, we will calculate the FV of the cash flow made in year 3, which is 12 years away from year 15.
Using the future value formula:
\[ FV = PV \times (1 + i)^N \]
Where:
- $ PV = 250 $
- $ i = 0.11 $
- $ N = 15 - 3 = 12 $
Substituting:
\[
FV = 250 \times (1 + 0.11)^{12}
\]
\[
FV = 250 \times (1.11)^{12}
\]
\[
FV \approx 250 \times 3.478
\]
\[
FV \approx 869.50
\]
Conclusion: The amount in year 15 of a 0 cash flow made in year 3 at an 11% interest rate is approximately 9.50.

Problem 4-30: Solving for Rate of Return

Question: What annual rate of return is earned on a ,000 investment when it grows to ,500 in five years?
Solution:
Using the formula for future value, rearranged to solve for the rate of return $ i $:
\[ FV = PV \times (1 + i)^N \]
Set $ FV = 9500 $, $ PV = 5000 $, and $ N = 5 $:
\[
9500 = 5000 \times (1 + i)^5
\]
\[
\frac{9500}{5000} = (1 + i)^5
\]
\[
1.9 = (1 + i)^5
\]
To find $ i $:
\[
1 + i = (1.9)^{1/5}
\]
Calculating $ (1.9)^{1/5} $ gives approximately 1.60:
\[
i \approx 0.60 \text{ or } 60\%
\]
Conclusion: The annual rate of return earned on a ,000 investment that grows to ,500 in five years is approximately 60%.

Problem 4-41: Combined Present Value of Cash Flows

Question: What is the combined present value of 0 in year 1, ,000 in year 2, and -0 (payment) in year 3 at 10% interest?
Solution:
Calculating each cash flow's present value and then summing:
1. PV of 0 in year 1:
\[ PV = \frac{500}{(1.10)^1} = \frac{500}{1.1} \approx 454.55 \]
2. PV of ,000 in year 2:
\[ PV = \frac{1000}{(1.10)^2} = \frac{1000}{1.21} \approx 826.45 \]
3. PV of -0 in year 3:
\[ PV = \frac{-800}{(1.10)^3} = \frac{-800}{1.331} \approx -601.80 \]
Total PV:
\[ Total PV \approx 454.55 + 826.45 - 601.80 = 679.20 \]
Conclusion: The combined present value of the cash flows is approximately 9.20.

References

1. Brealey, R. A., Myers, S. C., & Allen, F. (2017). Principles of Corporate Finance. McGraw-Hill.
2. Ross, S. A., Westerfield, R. W., & Jordan, B. D. (2016). Fundamentals of Corporate Finance. McGraw-Hill.
3. Bodie, Z., Kane, A., & Marcus, A. J. (2014). Investments. McGraw-Hill.
4. Fabozzi, F. J. (2016). Fixed Income Analysis. Wiley.
5. Van Horne, J. C., & Wachowicz, J. M. (2010). Fundamentals of Financial Management. Prentice Hall.
6. Damodaran, A. (2010). Applied Corporate Finance. Wiley.
7. McKinsey & Company Inc. (2015). Valuation: Measuring and Managing the Value of Companies. Wiley.
8. Brigham, E. F., & Ehrhardt, M. C. (2017). Financial Management: Theory & Practice. Cengage Learning.
9. Arnold, G. (2011). Corporate Financial Management. Pearson.
10. Ross, S. A., Westerfield, R. W., & Jordan, B. D. (2020). Fundamentals of Corporate Finance. McGraw-Hill.
This comprehensive guide should help you navigate similar financial problems by following the processes and using the provided formulas accurately.

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