Mathematics
Financial Valuation and Quantitative Techniques Excel Template Problem Sets (2 Assignments)

### Question Description

Hello I am currently in a graduate master's program business math course and I have two excel template problem sets that are posted that deals with problems with regards to annuities and financial investments for the most part. Math has never been a strong point and I would really appreciate any help I can receive on this for better understanding.

Side Note: If possible, I would kindly request also a separate "word document" to see how each problem got solved for better understanding of how to set up financial math problems when it comes to deriving the solution for each one that I am struggling with for both these two different excel problem set assignments.

Purpose of Assignment (First Assignment "Financial Valuation (Time-Value of Money Cases)" Excel template attached below.

The purpose of this assignment is to provide students an opportunity to apply the concepts of time value of money covered in Ch. 13 to integrated case studies.

Assignment Steps

Resources: Financial Valuation (Time-Value of Money) Cases Excel® Template

Save the Financial Valuation (Time-Value of Money) Cases Excel® Template to your computer.

Read the instructions on the first tab.

Complete the three cases located in the template.

Click the Assignment Files tab to submit your assignment.

Purpose of Assignment (Second Assignment "Quantitative Techniques in Financial Valuation Problem Set") Excel template attached below

The purpose of this assignment is to provide students an opportunity to practice and learn the time-value of money concepts covered during Week 4. Students will understand how to evaluate future values, present values, interest rates, and time periods for financial investments.

Assignment Steps

Resources: Quantitative Techniques in Financial Valuation Problem Set Excel® Template

Save the Quantitative Techniques in Financial Valuation Problem Set Excel® Template to your computer.

Read the instructions on the first tab.

Complete the twelve exercises located in the template and record your answers in the highlighted spaces.

Format your paper consistent with APA guidelines.

Click the Assignment Files tab to submit your assignment.

### Unformatted Attachment Preview

Purchase answer to see full attachment

Attached.

Barry learned in an online investment course that he should start investing as soon
as possible. He had always thought that it would be smart to start investing after he
finishes college and when his salary is high enough to pay the bills and to have money
left over. He projects that will be 5–10 years from now. Barry wants to compare the
difference between investing now and investing later. A financial advisor who spoke
to Barry suggested that a Roth IRA (Individual Retirement Account) would be a good
investment for him to start.
1. If Barry purchases a \$2,000 Roth IRA when he is 25 years old and expects to
earn an average of 6% per year compounded annually over 35 years (until he is
60), how much will accumulate in the investment?
Initial Investment (PV)
Quoted Rate
Compounding Frequency
Number of compoundings (m)
Quoted Rate divided by m = RATE
Number of Years
NPER (Num. of years * m)
Ending Amount (FV)

\$2.000
6,00%
Annually Choose one
1
For Quarterly, type 4; for semiannually, type 2; for annually, ty
6,0000%
35
35
\$15.372,17

2. If Barry doesn’t put the money in the IRA until he is 35 years old, how much
money will accumulate in the account by the time he is 60 years old using the same
return of 6%? How much less will he earn because he invested 10 years later?
Initial Investment (PV)
Quoted Rate
Compounding Frequency
Number of compoundings (m)
Quoted Rate divided by m = RATE
Number of Years
NPER (Num. of years * m)
Ending Amount (FV)

\$2.000
6,00%
Annually
1
6,0000%
25
25
\$8.583,74

Difference in amount earned
FV Part 1 minus FV Part 2

\$6.788,43

Choose one
For Quarterly, type 4; for semiannually, type 2; for annually, ty

3. Barry knows that the interest rate is critical to the speed at which your investment grows.
For instance, if \$1 is invested at 2% compounded annually, it takes approximately 34.9 years
to double. If \$1 is invested at 5% compounded annually, it takes approximately
14.2 years to double.
Determine how many years it takes \$1 to double if invested at 10% compounded annually; at
12% compounded annually.
Present value (PV)
Future value (FV)

1
2

1
2

Qouted rate
Number of years

10%
7,2725

12%
6,1163

4. At what interest rate would you need to invest to have your money double
in 10 years if it is compounded annually?
PV
FV
NPER
RATE

\$2.000
\$4.000
10
7,18% -- Use the RATE function in Excel. PV should be negative, FV sho

ually, type 2; for annually, type 1; for monthly, type 12; for daily, type 365

ually, type 2; for annually, type 1; for monthly, type 12; for daily, type 365

Abdol Akhim has just come from a Personal Finance class where he learned that he
can determine how much his savings will be worth in the future. Abdol is completing
computers in his spare time to pay for his tuition and books. Abdol got out his savings
records and decided to apply what he had learned. He has a balance of \$1,000 in a
money market account at First Savings Bank, and he considers this to be an emergency
fund. His instructor says that he should have 3–6 months of his total bills in an
emergency fund. His bills are currently \$700 a month. He also has a checking account and a
regular savings account at First Savings Bank, and he will shift some of his funds from
those accounts into the emergency fund. One of Abdol’s future goals is to buy a house.
He wants to start another account to save the \$8,000 he needs for a down payment.
1. How much interest will Abdol receive on \$1,000 in a 365-day year if he keeps
it in the money market account earning 1.00% compounded daily?
Initial Investment (PV)
Quoted Rate
Compounding Frequency
Number of compoundings (m)
Quoted Rate divided by m = RATE
Number of Years
NPER (Num. of years * m)
Ending Amount (FV)
Compound Interest

\$1.000
1,00%
Daily
365
0,0027%
1
365
\$1.010,05
\$10,05

Choose one
For Quarterly, type 4; for semiannually, type 2; for annually

2. How much money must Abdol shift from his other accounts to his emergency fund
to have four times his monthly bills in the account by the end of the year?
Desired Emergency fund
Current balance in money mkt.
Interest that Abdol will earn
Balance to be transferred

\$2.800
\$1.000
\$10,05
\$1.789,95

3. Abdol realizes he needs to earn more interest than his current money market can provide.
Using annual compounding on an account that pays 5.5% interest annually, find the amount
Abdol needs to invest to have the \$8,000 down payment for his house in 5 years.
Future Value Needed (FV)
Quoted Rate
Compounding Frequency
Number of compoundings (m)
Quoted Rate divided by m = RATE
Number of Years
NPER (Num. of years * m)
Amount Invested Now (PV)

\$8.000
5,5%
Annually
1
5,5000%
5
5
\$6.121,07

Choose one
For Quarterly, type 4; for semiannually, type 2; for annually

4. Is 5.5% a realistic rate for Abdol to earn in a relatively short-term investment of 5 years, particularly at his bank?

Hint: For answering this question, explore how much interest do banks pay on short-term investments or CDs.
Compare this number with 5.5% to see whether it is a realistic goal. If not, propose to Abdol what should he invest in
Abdols compounding account that pays 5.5% in a short term investment of
5 years is no realistic. After exploring the interest rate which banks pay on a
short-term investment or CDs, its concluded that the nations average rate is
about 2.10% annually. In comparing the 5.5% rate to the 2.10% rate there
is a 3.4% rate difference. In order for Abdol to obtain \$8,000 he would have
to invest \$7,210.43 and that is the 2.10% rate annually for 5 years.

Future Value Needed (FV)
Quoted Rate
Compounding Frequency
Number of compoundings (m)
Quoted Rate divided by m = RATE
Number of Years
NPER (Num. of years * m)
Amount Invested Now (PV)

\$8.000
2,1%
Annually
1
2,1000%
5
5
\$7.210,43

ually, type 2; for annually, type 1; for monthly, type 12; for daily, type 365

ually, type 2; for annually, type 1; for monthly, type 12; for daily, type 365

At 45 years of age, Seth figured he wanted to work only 10 more years. Being a full-time landlord had a lot
of advantages: cash flow, free time, being his own boss—but it was time to start thinking toward retirement.
The real estate investments that he had made over the last 15 years had paid off handsomely. After selling a
duplex and paying the associated taxes, Seth had \$350,000 in the bank and was debt-free. With only 10 years
before retirement, Seth want...

Tutor_Booth (14905)
Cornell University
Review

Anonymous
Top quality work from this tutor! I’ll be back!

Anonymous
It’s my second time using SP and the work has been great back to back :) The one and only resource on the Interwebs for the work that needs to be done!

Anonymous
Thanks, good work

Studypool
4.7
Trustpilot
4.5
Sitejabber
4.4

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