Time Value of Money Assignment Please do all the problems in Excel. Please show your work in order to get credit. For each problem, state the inputs, what you are asked to compute and then use the Finance function in Excel to get the correct answer. Please upload the Excel spreadsheet. Merely stating the answer will earn zero points even if the answer is correct. 1. If you wish to accumulate $150,000 in 13 years, how much must you deposit today in an account that pays an annual interest rate of 14%? 2. What will $250,000 grow to be in 9 years if it is invested today in an account with an annual interest rate of 11%? 3. How many years will it take for $140,000 to grow to be $480,000 if it is invested in an account with an annual interest rate of 8%? 4. At what annual interest rate must $137,000 be invested so that it will grow to be $475,000 in 14 years? 5. If you wish to accumulate $197,000 in 5 years, how much must you deposit today in an account that pays a quoted annual interest rate of 13% with semi-annual compounding of interest?45 6. What will $153,000 grow to be in 13 years if it is invested today in an account with a quoted annual interest rate of 10% with monthly compounding of interest?
Problems based on the concept of Time value of money takes the good amount of time. Moreover, there are numerous variations that make it harder for the student to grasp everything. However, you are just required to understand the concept and rest will fall into the place. Few of the areas are Loan Amortization schedule calculation, Car loan schedule calculation, etc. Finance assignment experts working with AllAssignmentHelp have been helping the students with their academic papers, essays and problems for a long time. Hence, you can trust our expertise and relax.
Example of time value of money for solving assignment
Let us take an example straight away to understand the concept of time value of money assignment help.
Amount Invested = 50 dollars (current value)
Rate of Interest = 10 per cent
So 50 dollars invested today will become 55 dollars exactly one year from now, and both have the same value to the recipient who assumes 10 per cent interest. In terms of time value of money assignment help we can say that 50 dollars today is equivalent to 55 dollars after a year.
We can go in the opposite direction as well. Amount of 105 dollars can be discounted to calculate the present value.
It involves basic mathematics and algebra to calculate the time value of money. We discount the future value equivalent to the time value of money assignment help.
PV = FV - r*PV = FV/(1+r).
Here PV is the present value and FV is the future value and r is the rate of interest.(1+r) in the denominator is called the discounting factor in time value of money concept.
Definition of the few terms that are frequently used while solving time value of money assignment sample questions are:
- Future cash flows are discounted at the discount rate, and the higher the discount rate, the lower the present value of the future cash flows assignment help
- Present value is the current worth of a future sum of money at a specific rate of return.
- Present value of an annuity assignment help is a series of equal payments that occur at evenly spaced intervals is termed as the present value of an annuity. Two common examples can be Leases and rental payments. It can be either the end of the annuity period or it can be due at the beginning of the annuity period.
- Future value of an annuity (FVA) assignment help is the future value of a stream of payments (annuity), assuming the payments are invested at a given rate of interest
- Future value is the value of an asset or cash on a specified date in future that is equivalent in value to a specified sum today.
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