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A)What is the present value of $26,400 to be received in 20 years; i = 6%....

A)What is the present value of $26,400 to be received in 20 years; i = 6%. (Round answer to 0 decimal places, e.g. 5,275.)

Present value : ...........

B)What is the present value of a 15-year annuity of $2,600 per year; i = 5%. (Round answer to 0 decimal places, e.g. 5,275.)
PRESENT VALUE : ...................

C)What is the present value of a 5-year annuity of $3,500 with the first payment to be received 3 years from now; i = 8%

D)

What will be your annual payment if you take now a loan of $220,000 with annual equal repayments over the next 10 years? i = 6%

E)

You take out a loan in the amount of $220,000 with annual equal repayments over the next 20 years. What is the balance of the loan after the 5th payment? i = 6%. (Round answer to 0 decimal places, e.g. 5,275.)

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Answer #1

Calculate the present value of the investment as follows:

1 Particulars Amount 2 a Present value 3 b Present value 4 c Present value 5 d Annual payment 6 Annual payment 7 Year $8,232 $26,987 $13,974.49 $29,891 $19,180.60 $11,093 Beginning balance Annual payment Interest 220000$19,180.60 $214,019.40 $207,679.96 $200,960.15 $193,837.16 $186,287 Principal Closing balance 13200 $5,980.60$214,019.40 $19,180.60 12841.16385 $6,339.44 $207,679.96 $19,180.60 12460.79753 $6,719.81$200,960.15 $19,180.60 12057.60923 $7,122.99 $193,837.16 $19,180.60 11630.22963 $7,550.37$186,286.79 2 10 4 12 13 e Loan balance

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Formulas:

1 Particulars Amount -PV(696,20,,-26400) -PV(596,15,-2600) -PV(8%,5,3500) a Present value b|Present value -PV(896,3,,-C4) 4c Present value 5 d Annual payment-PMT(6%,10,-220000) Annual payment-PMT(6%,20,-220000) 7 Year 8 1 9 2 10 3 11 4 12 5 13 e Loan balanceG12 Annual payment Interest Principal Closing balance $C$6 $C$6 Beginning balance 220000 G8 G9 G10 G11 $C$6 $C$6 -C10*690-D10-E10 1-c10-F10 -C11690-D11-E11 |-c11-F11 C12*6% D12-E12 C12-F12

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