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Unformatted text preview: ermine FV for each of the following compounding periods by changing only the following: a. np to 2, and ir to 8/2 b. np to 12, and ir to 8/12 c. np to 52, and ir to 8/52 3. To determine the PV of a fixed amount, enter the following: Into FV, 1080; into np, 1; into pmt, 0; and, into ir, 8. Now click on Calculate PV. What is the PV? 4. To determine the FV of an annuity, enter the following: Into PV, 0; into FV, 0; into np, 12; into pmt, 1000; and, into ir, 8. Now click on Calculate FV. What is the FV? 5. To determine the PV of an annuity, change only the FV setting to 0; keep the other entries the same as in question 4. Click on Calculate PV. What is the PV? 6. Check your answers for questions 4 and 5 by using the techniques discussed in this chapter. Go to Web site www.homeowners.com/. Click on Calculators in the left column. Click on Mortgage Calculator. 7. Enter the following into the mortgage calculator: Loan amount, 100000; duration in years, 30; and interest rate, 10. Click on compute payment. What is the monthly payment? 8. Calculate the monthly payment for $100,000 loans for 30 years at 8%, 6%, 4%, and 2%. 9. Calculate the monthly payment for $100,000 loans at 8% for 30 years, 20 years, 10 years, and 5 years. Remember to check the book’s Web site at www.aw.com/gitman for additional resources, including additional Web exercises....
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