MAFN020006

# MAFN020006 - 2-6 We use the NPER function to get the time...

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Unformatted text preview: 2-6 We use the NPER function to get the time period to double PV 200 FV 400 Rate Time to double 7% 10.24 years 10% 7.27 years 18% 4.19 years 100% 1 year 2-7 We write the cash flows in the years and then discount the cash flows to get the present value Discounting Factor Year Cash Flow @8% PV 1 100 0.9259 92.59 2 100 0.8573 85.73 3 100 0.7938 79.38 4 200 0.7350 147.01 5 300 0.6806 204.17 6 500 0.6302 315.08 PV of total cash flow \$ 923.98 To calculate the future value, we compound the cash flows Compounding Factor Year Cash Flow @8% FV 1 100 1.4693 146.93 2 100 1.3605 136.05 3 100 1.2597 125.97 4 200 1.1664 233.28 5 300 1.0800 324.00 6 500 1.0000 500.00 FV of total cash flow \$ 1,466.23 2-8 Amount Period Rate Monthly Loan Payment EAR 20,000 60 months 1% per month \$444.89 12.68% ...
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