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Excel Asignment -- BMGT 301 -- Fall 301 (701)

# Excel Asignment -- BMGT 301 -- Fall 301 (701) - BMGT 301...

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BMGT 301 / Fall 2011 Excel Assignment Dr. karake DUE AT 5:00 PM ON NOVEMBER 7 th I. Financial Applications (5 points) 1) Ryan decides to borrow \$1,000,000 from the Easy Going Bank to open a new business. The Bank is offering him the following terms: the bank will give him a 20-year loan with 8 percent interest rate, paid monthly. a.i) Use excel to determine the value of the monthly payment (1 point) a.ii) Construct a loan amortization table including the following fields: Period, Remaining Principal, Interest Payment, Principal Payment (2 points) 2) Assume Ryan had another option to finance his business; he has \$900,000 placed in a money market account 2 years ago. The terms of the account include a fixed annual interest rate of 4 percent compounded monthly. What is not known is the current value of this account and whether this value will be sufficient to cover the capital investment required for his project. a.i) Find the current value of the Money Market account. (1 point) 3) In an effort to facilitate the lending process, Easy Going Bank is offering the following option: A loan of \$1,000,000 to be paid over the next four years with equal semi-annual payments of \$150,000 (compounded semiannually). a.i) Find the annual interest rate for this option. (1 point)

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II. Estimating Travel Expenses (5 points) A travel company rents cars, vans and limos to a wide range of customers. Customers usually call the company to receive rental quotes. As gas prices have been climbing, customers have become more conscious of fuel efficiency and its impact on their total cost of transportation. As a service to customers, the company has modified its quotes workbook to include information on its cars’ mileage and an estimate of gas expenses related to customers’ trips. All that remains to be added to the workbook is information specific for each car type, and a more detailed analysis of the interaction between gas prices and total cost of transportation.
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