Account question | Business & Finance homework help

9/10/23, 9:42 PM Assignment Print View

1. Award: 10.00 points

Use the FV function in Excel to answer this problem.

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Calculating future values – Excel

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Excel Simulation Difficulty: 1 Basic Section: 5.1 Future Value and Compounding

9/10/23, 9:43 PM Assignment Print View

2. Award: 10.00 points

Use the PV function in Excel to answer this problem.

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Calculating present values – Excel

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Excel Simulation Difficulty: 1 Basic Section: 5.2 Present Value and Discounting

9/10/23, 9:44 PM Assignment Print View

3. Award: 10.00 points

Use the RATE function in Excel to answer this problem.

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Calculating interest rates – Excel

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Excel Simulation Difficulty: 1 Basic Section: 5.3 More about Present and Future Values

9/10/23, 9:45 PM Assignment Print View

4. Award: 10.00 points

Use the NPER function in Excel to answer this problem.

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Calculating the number of periods – Excel

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Excel Simulation Difficulty: 1 Basic Section: 5.3 More about Present and Future Values

9/10/23, 9:45 PM Assignment Print View

5. Award: 10.00 points

Imprudential, Inc., has an unfunded pension liability of $700 million that must be paid in 20 years. To assess
the value of the firm’s stock, financial analysts want to discount this liability back to the present. If the relevant
discount rate is 7.0 percent, what is the present value of this liability? 

$180,893,302

$184,511,168

$195,357,153

$177,275,436

$166,421,838

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Multiple Choice Difficulty: Basic Learning Objective: 05-2

9/10/23, 9:46 PM Assignment Print View

6. Award: 10.00 points

You have just made your first $3,000 contribution to your retirement account. Assume you earn an 8 percent
annual rate of return and make no additional contributions.

Required:
(a) What will your account be worth when you retire in 40 years?

(Click to select)

(b) What will your account be worth if you wait 7 years before contributing?

(Click to select)

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Worksheet Difficulty: Intermediate Learning Objective: 05-1

9/10/23, 9:46 PM Assignment Print View

7. Award: 10.00 points

You’re trying to save to buy a new $150,000 Ferrari. You have $34,000 today that can be invested at your
bank. The bank pays 5.0 percent annual interest on its accounts. How long will it be before you have enough
to buy the car?

NOTE: In this problem there is only one cash flow (chapter 5 problem). FV = PV (1+r)t is the equation you use.
In this problem you are solving for t.

30.67 years

28.42 years

30.92 years

30.42 years

30.17 years

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Multiple Choice Difficulty: Basic Learning Objective: 05-4

9/10/23, 9:48 PM Assignment Print View

10. Award: 10.00 points

A zero coupon bond with a face value of $1,000 is issued with an initial price of $350. The bond matures in 14 years. What is the implicit annual interest rate
on the bond?
NOTE: Assume all bonds (unless otherwise noted) have a $1,000 face value, which is a promise to pay $1,000 at maturity (when the loan comes due). When
bonds pay interest over the life of the loan, we refer to these interest payments as coupons. A zero coupon is a pure discount loan, so it pays no coupons.
That is, it is a bond where the company agrees to borrow money today in exchange for a single payment ($1,000) at maturity. U.S. Treasury Bills mentioned
in the text book are an example.

9.79%

8.79%

6.79%

7.79%

5.79%

References

Multiple Choice Learning Objective: 07-01
Important bond features and
types of bonds.

Difficulty: Medium Section: 7.4

9/10/23, 9:47 PM Assignment Print View

8. Award: 10.00 points

You are scheduled to receive $43,000 in two years. When you receive it, you will invest it for 7 more years at
7.5 percent per year. How much will you have in 9 years?

rev: 09_17_2012

$74,906.07

$82,441.26

$50,257.42

$71,339.11

$67,772.16

9/10/23, 9:48 PM Assignment Print View

9. Award: 10.00 points

In January 2007, the average price of an asset was $28,158. 8 years earlier, the average price was $21,908.
What was the annual increase in selling price?

3.51%

2.87%

-3.09%

3.19%

3.82%

References

Multiple Choice Difficulty: Basic Learning Objective: 05-3

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