# FIN/370 Week 2 Calculating Present Values, accounting homework help

*label*Business Finance

*timer*Asked: Mar 8th, 2017

*account_balance_wallet*$10

**Question description**

**Show** all work and analysis.** **

**Prepare** in Microsoft^{®} Excel^{®} or Word.** **

- Ch. 5: Questions 3 & 4 (Question and Problems section): Microsoft
^{®}Excel^{®}templates provided for Problems 3 and 4 - Ch. 6: Questions 2 & 20 (Questions and Problems section)
- Ch. 7: Questions 3 &11 (Questions and Problems section)
- Ch. 8: Questions 1 & 6 (Questions and Problems section): Microsoft
^{®}Excel^{®}template provided for Problem 6

**Format** your assignment consistent with APA guidelines if submitting in Microsoft^{®} Word

## Tutor Answer

please find the attached completed assignment.

FIN 370 WEEK 2

“FIN 370 WEEK 2.”

Name:

Course code:

Institution of affiliation:

Date of submission:

1

FIN 370 WEEK 2

3. Calculating Present Values [LO2] For each of the following, compute the present

value:

SOLUTION.

Present value refers to the current value of the money which is payable at some specified

future time.

It can be calculated by the formula

PV= FV[1/(1+i)n

Where:

PV is the present value

FV is the future value

I is interest rate

N is the number of years.

For:

i.

FV given as $15,451

i= 9%

n= 13yrs

2

FIN 370 WEEK 2

PV

= $15,451x[1/(1+0.09)13

= $15,451 x 1/3.066

= $5,039.47

Hence here the PV = $5,039.47

ii.

For;

FV given as $51,557

i is 7%

n is 4 years

PV

= 51, 557 x [1/ (1+0.07)4]

= 51,557x [1/1.311]

= $39,326.47

Hence PV is calculated as $39,326.47

iii.

For;

FV is given as $886,073

i is 24%

n is 29 years

PV

= 886,073 x [1/ (1+0.24)29]

= 886,073 x [1/511.95}

= $1.73

Hence the PV is calculated as $1.73

iv.

For;

FV is given as $550,164

3

FIN 370 WEEK 2

i is 35%

n is 40 years

= 550,164 x [1/(1+0.35)40]

PV

=550,164 x [1/163,437.13]

=$3.37

Hence PV is given as calculated as $3.37

4. Calculating Interest Rates [LO3] Solve for the unknown interest rate in each of the

following:

SOLUTION.

Interest rate is calculated using the formula:

Interest rate= (future value/present value) 1/years – 1

i.

given;

PV = $181

Years = 4 years

FV = $ 297

4

FIN 370 WEEK 2

Interest rate (i)

= (297/181)1/4 -1

= (1.6409)1/4 – 1

= 1.1318 – 1...

*flag*Report DMCA

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors