Question

1)please show with excel You buy an annuity which will pay you, and your heirs, $12,000...

1)please show with excel

You buy an annuity which will pay you, and your heirs, $12,000 a year forever. What is the value of this perpetuity today at a 7% discount rate?

200,000.00

222,222.22

120,000.00

171,231.00

171,428.57

2)please show how with excel

You make annual payments on a 10 year  $21,000 loan with 6% annual interest rate.   What is the principle portion of your 3rd payment?

1,065.45

2,475.38

196.82

2,852.53

1,790.15

Homework Answers

Answer #1

Q-1)

So,  the value of this perpetuity today is $171,428.57

Option 5

Q-2)

Calculating the Principal Portion in 3rd year using Excel PPMT function:-

So, the principle portion of your 3rd payment is $1790.15

Option 5.

If you need any clarification, you can ask in comments.     

If you like my answer, then please up-vote as it will be motivating     

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Please show the below problem in Excel: John and Peggy would like to buy a house....
Please show the below problem in Excel: John and Peggy would like to buy a house. They have looked at their budget and determined that they can afford a maximum monthly mortgage payment of $1,100. Interest rates on 30-year, fixed-rate mortgages currently have a nominal annual interest rate of 7 percent with monthly compounding (payments due at the end of each month). Given these loan terms, what is the maximum amount John and Peggy borrow today to purchase a house...
Find the present value of a 20-year annuity with annual payments which pays $600 today and...
Find the present value of a 20-year annuity with annual payments which pays $600 today and each subsequent payment is 5% greater than the preceding payment. The annual effective rate of interest is 10.25%. Answer: 7851.19 Please show which equations you used and please do not use excel to answer this question.
You are borrowing $21,000 with no money down to buy a car.
Please use Excel to answer it: You are borrowing $21,000 with no money down to buy a car. The terms of the loan call for equal monthly payments for 5 years at 4.25% annual interest. What is the amount of each monthly payment?
How much would you be willing to pay today for an ordinary annuity that makes equal...
How much would you be willing to pay today for an ordinary annuity that makes equal annual payments of $3,000 each year. You will receive your first payment 7 years from today and you will receive your last payment 32 years from today. The interest rate on this annuity is 4.1%
You borrowed $50,000 for your business today with an interest rate of 7.5%. Your first of...
You borrowed $50,000 for your business today with an interest rate of 7.5%. Your first of five (5) equal annual payments on this loan will be made one year from now. PLEASE SHOW ALL EXCEL FORMULAS/FUNCTIONS (A) What is your annual payment on this loan? (B) Create an amortization table for this loan. The headings and periods (years) for the amortization table are provided below.
You have been saving money to buy a home and today, you decided to buy a...
You have been saving money to buy a home and today, you decided to buy a home and take out $350,000 mortgage loan from a bank. This loan requires you to make a monthly payment for 30 years and the interest rate on your loan is 4% APR compounded monthly. What is your monthly mortgage payment for this loan? Please show your excel formula in your answer and explain step-by-step calculation to arrive to your answer.
Present Values: Please provide the calculations in MS Excel for the present value of an $7,000...
Present Values: Please provide the calculations in MS Excel for the present value of an $7,000 goal in 7 years at 7% discounted on an annual, semi-annual, quarterly, monthly, and daily basis to the nearest penny. Future Values: Please provide the calculations in MS Excel for a future value of an $7,000 investment today in 7 years at 7% compounded on an annual, semi-annual, quarterly, monthly, and daily basis to the nearest penny. Present Value of an Annuity: Please provide...
(Solving for r of an annuity) You lend a friend $30,000, which your friend will repay...
(Solving for r of an annuity) You lend a friend $30,000, which your friend will repay in 5 equal annual end-of-year payments of $8,000, with the first payment to be received 1 year from now. What rate does your loan reciece? The rate of return your loan will receive is ____%(round to two decimal places)
You want to buy a new work truck for $42,000. You will make a down payment...
You want to buy a new work truck for $42,000. You will make a down payment of $4,000. What are your MONTHLY loan payments for a 5 year term. Use 9% annual nominal interest compounded monthly for your loan. Please show work either either through excel or written for comparing and better understanding. I got 788.82 dollars
5. An insurance agent is trying to sell you an immediate retirement annuity, which for a...
5. An insurance agent is trying to sell you an immediate retirement annuity, which for a lump-sum fee paid today will provide you with $50,000 every year for the next 20 years. You currently earn 8 percent annual return on investments with comparable risk to the retirement annuity. What is the most you would pay for this annuity? 6. You need $300,000 to buy a house. You decide to borrow money from the bank to finance your mortgage. Assume that...