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MyFinanceLab Ch. 6:
•
What is the balance on your current loan if you just made the 60
th
payment?
o
Find PV of remaining 240 payments
o
=PV (.07/ 12, 240, payments of 2120.34)
•
The long retirement problem:
o
Initial sum:
NPV (rate, inputs)
•
APR = nominal rate = yearly “false” rate
o
Not the EAR
•
When setting up cash flows, make sure you make the initial deposit year 0, and leave it
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Unformatted text preview: out of the NPV equation • “Three investment alternatives, each w/ deposits at different/ missing years”: o Set up as uneven cash flow problems in Excel o Find NPVs o Include all years and 0’s in range • Continuous compounding: o FV = PV x e^(rate x time) o PV = cash flow/ e^(rate x time)...
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This note was uploaded on 06/11/2011 for the course BUSI 408 taught by Professor Croce during the Spring '08 term at UNC.
 Spring '08
 Croce
 Finance, Corporate Finance

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