Question

Time Value of Money Graded Assignment Due Sunday 01.27.19 at 11:45 PM Attempts: Keep the Highest: 12 8. Implied interest rate and period Aa Consider the case of the following annuities, and the need to compute either their e duration. expected rate of return or Anthony needed money for some unexpected expenses, so he borrowed $6,088.30 from a friend and agreed to repay the loan in eight equal instalments of $1,100 at the end of each year. The agreement is offering an implied interest rate of Anthony's friend, Jack, wants to go to business school. While his father will share some of the expenses, Jack stil eeds to put in the rest on his own. But Jack has no money saved for it yet. According to his calaulations, it will cost him $12, to deposit $3,800 at the end of every year in a mutual fund, from which he expects to earn a fixed 10% rate of return. It will take approximately 578 to complete the business program, including tuition, cost of living, and other expenses. He has decided years for Jack to save enough money to go to business Et

Answer 1

In the following images , calculation of the required implied interest rate and time period is done using Excel's RATE function and NPER function respectively.