Business Finance Assignment
Tasks to complete:
1. Download and save the Excel file, "Excel_Assignment". The file is located in the Excel Assignment folder.
2. Save the file to your own drive and rename the file with your last name and first name.
3. The Excel file contains worksheet tabs, one for each problem. Complete each problem by entering your answer in the indicated space. Use Excel formulae, functions, and cell referencing (when possible) to complete each problem. DO NOT solve the problem using a calculator and then type the answer in Excel, this will result in "0" credit for the problem.
4. Submit your answer file on Blackboard by the deadline.
Fair warning: file sharing is an act of academic dishonesty. See policy in the syllabus.
Question 1
You want to buy a $300,000 house. You plan to make a down payment of 20% of the purchase price and finance the rest with a 30-year fixed rate mortgage loan. The loan is fully amortizing, and requires monthly payments at the end of each month. The nominal loan rate is 5%, compounded monthly. 1) How much of the purchase price will you finance with the mortgage loan? 2) What is your anticipated monthly mortgage payment?
Question 2
Suppose that you deposit $200 at the end of each month into an account paying an expected annual rate of return of 3%, compounded monthly. How much money will you have in the account in 10 years?
Question 3
An investment offers to pay you $300 per quarter for 10 years. If the annual rate is 11% with quarterly compounding, then what is the present value of these cash flows?
Question 4
You currently have $4,000 in a bank account that pays a nominal rate of 1%, compounded monthly. You plan to make additional monthly deposits of $200, starting at the end of this month. How many payments will you have made when your account balance reaches $50,000?
Question 5
A basketball player is offered the following contract today, Jan. 1, 2012: $2 million immediately, $2.40 million in 2012, $2.90 million in 2013, $3.60 million in 2014, and $3.80 million in 2015. Assume all payments other than the first $2 million are paid at the end of the year. If the appropriate discount rate is 10 percent per year, what is the present value of the deal?
Attachment:- Excel_Assignment.xlsx