Q3. Consider the following capital market. You want to be able to withdraw 1$150K five years...

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Answer 1

Answer #1

1-	Present value - today	Using present value function in MS excel	pv(rate,nper,pmt,fv,type) rate =4.2% nper = 5 pmt =0 fv =150 type =0	PV(4.2%,5,0,150,0)	($122.11)
2-	Present value - today	Using present value function in MS excel	pv(rate,nper,pmt,fv,type) rate =4.2% nper = 4 pmt =0 fv =150 type =0	PV(4.2%,4,0,150,0)	($127.24)
3-	Annual payment	Using pmt function in MS excel	pmt(rate,nper,pv,fv,type) rate =4.2% nper = 5 pv =0 fv= 150 type =0	PMT(4.2%,5,0,150,0)	($27.58)
4-	Annual payment	Using pmt function in MS excel	pmt(rate,nper,pv,fv,type) rate =4.2% nper = 5 pv =0 fv= 150 type = 1	PMT(4.2%,5,0,150,1)	($26.47)

Answer 2

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