Finance Questions
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hf5chap11.pptx
CHAPTER 11 Long-Term Debt Financing
To meet its mission, a business must have assets, and to acquire assets a business needs capital (money). Businesses raise capital in two basic forms: debt capital, which is supplied by lenders (creditors) and equity capital, which is supplied by owners (or the community in NFPs). This chapter focuses on debt capital, while the next chapter covers equity capital.
Copyright © 2012 by the Foundation of the American College of Healthcare Executives 11/9/11 Version
11 - ‹#›
The Cost of Money
The interest rate on a debt security is the cost of that capital. Furthermore, interest rates influence the cost of all capital.
Four primary factors influence the general level of interest rates:
Investment opportunities
Time preferences for consumption
Risk
Inflation expectations
11 - ‹#›
Common Long-Term Debt Instruments
Term loans
Bonds
Treasury
Corporate
Municipal
Corporate bond types
Mortgage bonds
Debentures
Subordinated debentures
Public sale versus private placement
11 - ‹#›
Debt Contracts
Debt contracts have several different names:
Bond indenture
Loan agreement
Promissory note
They usually contain:
General provisions
Maturity (when the principal must be repaid)
Type of debt
Interest rate and type
Restrictive covenants
Trustee designation (bond issue only)
11 - ‹#›
Debt Contracts (Cont.)
Call provisions
Permit the borrower to redeem (pay back) the debt prior to maturity.
Typically a call premium is specified.
Call privilege usually is deferred.
Why would issuers want callability?
What impact does a call provision have on the riskiness of debt financing to lenders? To borrowers?
11 - ‹#›
Bond Ratings
Investment Grade
Speculative*
Moody’s
Aaa
Aa
A
Baa
Ba
B
Caa
C
S&P
AAA
AA
A
BBB
BB
B
CCC
D
Rating agencies assign debt ratings that reflect the probability of default. Here are some typical bond ratings:
Fitch
AAA
AA
A
BBB
BB
B
CCC
D
*Also called “junk”
11 - ‹#›
Bond Rating Concepts
Bond rating criteria
Issuer’s financial condition
Competitive situation
Quality of management
Includes both objective and subjective factors
Importance of ratings
To investors
To issuing businesses
Changes in ratings
Recent problems with ratings and rating agencies
11 - ‹#›
Credit Enhancement
Credit enhancement (bond insurance) is used primarily on municipal bonds.
Insured bonds have the rating of the insurer (AAA), not the issuer.
Issuers must pay an up-front fee to obtain bond insurance.
Recent trends in bond insurance.
How should issuers evaluate whether or not to use bond insurance?
11 - ‹#›
Interest Rate Components
The interest rate (required rate of return) on any debt security can be thought of a base rate plus one or more components to compensate for inflation and risk.
Here is the model:
Rate = RRF + IP + DRP + LP + PRP + CRP.
11 - ‹#›
Here:
RRF = Real risk-free rate.
IP = Inflation premium.
DRP = Default risk premium.
LP = Liquidity premium.
PRP = Price risk premium.
CRP
= Call risk premium.
11 - ‹#›
Interest Rate Example 1
1-Year Treasury Security
RRF = 2%; IP = 3%:
Rate = RRF + IP + DRP + LP + PRP + CRP
= 2% + 3% + 0 + 0 + 0 + 0
= 5%.
What additional premium(s) would be needed if it were a 30-year Treasury security?
11 - ‹#›
Interest Rate Example 2
30-Year HCA Callable Bond
RRF = 2%; IP = 4%; DRP, LP, PRP = 1%;
CRP = 0.4%:
Rate = RRF + IP + DRP + LP + PRP + CRP
= 2% + 4% + 1% + 1% + 1% + 0.4%
= 9.4%.
What would be the interest rate if the bond were noncallable?
What would be the rate if the issuer were Memorial Healthcare, a NFP provider?
11 - ‹#›
The Term Structure of Interest Rates
Term structure is the relationship between interest rates and debt maturities.
Thus, term structure tells us the relationship between short-term and long-term rates.
A graph of the term structure is called the yield curve.
11 - ‹#›
Treasury Yield Curve
0
4
5
6
5
10
15
Years to Maturity
Interest
Rate (%)
1 yr. 4.0%
5 4.5
10 5.0
15 5.2
20 5.5
2
3
Note: This represents a “typical” yield curve
20
25
11 - ‹#›
Debt Valuation
Why should healthcare managers worry about debt valuation?
Managers must understand how investors make resource allocation decisions.
Cost of financing is important to good capital investment decisions.
Debt valuation concepts can be applied to other types of investments.
11 - ‹#›
General Valuation Model
The financial value of any investment stems from the investment’s expected cash flows.
Thus, all investments are valued in the same way:
Estimate the expected cash flows
Assess their riskiness
Set the required rate of return
Discount the cash flows and sum the present values
11 - ‹#›
General Valuation Model (Cont.)
0
1
2
N
R(R)
CF1
CFN
CF2
...
PV CF1
PV CF2
PV CFN
Value
We will use bonds to illustrate debt valuation.
11 - ‹#›
Bond Definitions
Par value: Stated face value of the bond. Generally the amount borrowed and repaid at maturity. Often $1,000 or $5,000.
Coupon rate: Stated interest rate on the bond. Multiply by par value to get dollar coupon payment. Usually fixed.
11 - ‹#›
Maturity date: Date when the par value will be repaid to investors. Note that the effective maturity of a bond declines each year after issue.
New versus seasoned bonds: When a bond is issued, its coupon rate reflects current conditions. When conditions change, bond values change.
Bond Definitions (Cont.)
11 - ‹#›
Debt service requirements: Issuers are concerned with their total debt service payments, including both interest expense and principal repayment. Many municipal bond issues are structured so that debt service requirements are roughly constant over time. Such bonds are called serial issues.
Bond Definitions (Cont.)
11 - ‹#›
What is the value of a 15-year, 10% coupon bond if R(Rd) = 10%?
100
100
0
1
2
15
10%
100 + 1,000
...
$ 760.61
239.39
$1,000.00
What is the value if the bond were a zero-coupon bond?
11 - ‹#›
15 10 -100 -1000
N I/YR PV PMT FV
1000
The bond consists of a 15-year, 10% annuity of $100 per year plus a $1,000 lump sum at t = 15:
$ 760.61
239.39
$1,000.00
PV annuity
PV maturity value
PV annuity
=
=
=
INPUTS
OUTPUT
11 - ‹#›
Spreadsheet Solution 1
11 - ‹#›
Spreadsheet Solution 2
11 - ‹#›
14 10 -100 -1000
N I/YR PV PMT FV
1000
If interest rates (the required rate of return on the bond) stay constant, the bond’s value remains at $1,000.
What is the value after one year if interest rates (R[Rd]) remain constant?
INPUTS
OUTPUT
11 - ‹#›
Spreadsheet Solution 1
11 - ‹#›
Spreadsheet Solution 2
11 - ‹#›
14 5 -100 -1000
N I/YR PV PMT FV
1494.93
When R(Rd) falls, a bond’s value increases. Now the bond sells above its par value, or at a premium.
Now suppose interest rates fell, so that R(Rd) is now only 5 percent.
INPUTS
OUTPUT
11 - ‹#›
Spreadsheet Solution 1
11 - ‹#›
Spreadsheet Solution 2
11 - ‹#›
What would happen if interest rates rise, and R(Rd) is now 15 percent?
14 15 -100 -1000
N I/YR PV PMT FV
713.78
INPUTS
OUTPUT
When R(Rd) rises, a bond’s value decreases. Now the bond sells below its par value, or at a discount.
11 - ‹#›
Spreadsheet Solution 1
11 - ‹#›
Spreadsheet Solution 2
11 - ‹#›
M
Bond Value ($)
Years to Maturity
1,495
1,216
1,000
832
714
14 10 5 0
R(Rd) = 5%.
R(Rd) = 15%.
R(Rd) = 10%.
Bond Values Over Time
11 - ‹#›
At maturity, a bond’s value must equal its par value (plus final interest payment).
The value of a premium bond will decrease to par value at maturity.
The value of a discount bond will increase to par value at maturity.
A par bond value will remain at par if interest rates remain constant.
The return in each year consists of an interest payment (yield) and a price change (capital gains yield).
Bond Values Over Time (Cont.)
11 - ‹#›
35
Capital
gains yield
Current and Capital Gains Yield
Current yield =
Capital gains yield =
= +
Annual interest payment .
Current price
Change in price .
Beginning price
Total
return
Current
yield
.
11 - ‹#›
Find the current yield, capital gains yield, and total return (yield) for Year 1 when the interest rate falls to 5%. Remember the bond is bought for $1,000 at Year 0.
Current yield = = 0.100 = 10.00%.
$100
$1,000
CG yield = = 0.495 = 49.5%.
Total return = 10.0% + 49.5% = 59.5%.
$495
$1,000
11 - ‹#›
Repeat the calculation, but this time for Year 2.
Current yield = = 0.670 = 6.70%.
$100
$1,495
Capital gain = = -0.170 = -1.70%.
Total return = 6.7% - 1.7% = 5.0%.
-$25
$1,495
Why are the returns so different?
11 - ‹#›
Yield to Maturity
The yield to maturity (YTM) on a bond is the expected rate of return assuming the bond is held to maturity and no default is expected.
Mathematically, it is the discount rate that forces the present value of the cash flows from the bond to equal the bond’s price.
11 - ‹#›
What’s the YTM on a 14-year, 10% annual coupon, $1,000 par value bond that sells for $1,494.93?
100
100
100
0
1
13
14
YTM = ?
1,000
PV1
.
.
PV13
PV14
PVM
1,494.93
Find the discount rate that “works”!
...
1,494.93
11 - ‹#›
Using a Financial Calculator for YTM
INPUTS
OUTPUT
Could we have made a guess for the
YTM before doing the calculation?
14 1494.93 -100 -1000
N I/YR PV PMT FV
5.00
11 - ‹#›
Spreadsheet Solution 1
11 - ‹#›
Spreadsheet Solution 2
11 - ‹#›
Find the YTM if the price were $713.78.
INPUTS
OUTPUT
Could we have made a guess for the
YTM before doing the calculation?
14 713.78 -100 -1000
N I/YR PV PMT FV
15.0
11 - ‹#›
Spreadsheet Solution 1
11 - ‹#›
Spreadsheet Solution 2
11 - ‹#›
What is the yield to call (YTC) on a 14-year, 10% annual coupon,
$1,000 par value bond that sells for
$713.78 and can be called after 5 years at $1,100.
INPUTS
OUTPUT
5 -713.78 100 1100
N I/YR PV PMT FV
21.1
11 - ‹#›
Spreadsheet Solution 1
11 - ‹#›
Spreadsheet Solution 2
11 - ‹#›
Most Bonds Have Semiannual Coupons
Therefore, there are twice as many interest payments compared to annual coupon payments.
But, the interest payment is only half of the annual amount.
And the required rate of return is only half of the annual rate.
Otherwise, the valuation process is the same as for annual coupons.
11 - ‹#›
2x14 5 / 2 100 / 2
28 2.5 -50 -1000
N I/YR PV PMT FV
1499.12
What is the value of a 14-year, 10%
coupon, semiannual bond if the
required rate of return is 5 percent?
INPUTS
OUTPUT
11 - ‹#›
2x14 100 / 2
28 1400 -50 -1000
N I/YR PV PMT FV
2.90
Find the YTM of a 14-year, 10%
coupon, semiannual bond if the
bond is selling for $1,400.
INPUTS
OUTPUT
Thus, the annual YTM = 2 x 2.90% = 5.80%.
11 - ‹#›
Interest Rate Risk
Interest rates change constantly, which gives rise to two types of interest rate risk.
Price risk arises because bond values decline when interest rates rise.
Reinvestment rate risk arises because reinvested coupon (and principal) payments earn less when interest rates fall.
11 - ‹#›
Does a 1-year or 10-year 10% bond have more price risk?
R(Rd)
1-year
Change
10-year
Change
5%
$1,048
$1,386
10%
1,000
+4.8%
-4.4%
1,000
+38.6%
-25.1%
15%
956
749
11 - ‹#›
0
$500
$1,000
$1,500
0%
5%
10%
15%
1-year
10-year
R(Rd)
Value
.
.
.
.
.
.
11 - ‹#›
Does a 1-year or 10-year bond have more reinvestment rate risk?
Reinvestment rate risk depends both on the bond’s maturity and the investor’s holding period (investment horizon).
In general, the shorter the maturity relative to the investment horizon, the greater the reinvestment rate risk.
Why?
11 - ‹#›
Long-term bonds have high price risk but low reinvestment rate risk.
Short-term bonds have low price risk but high reinvestment rate risk.
Nothing is riskless! However, risk can be minimized by matching the maturity of the bond to the holding period.
How can interest rate risk be minimized?
11 - ‹#›
This concludes our discussion of Chapter 11 (Long-Term Debt Financing).
Although not all concepts were discussed in class, you are responsible for all of the material in the text.
Do you have any questions?
Conclusion
11 - ‹#›
ABCD
1
210.0%Interest rate
3
4100$ Year 1 coupon
5100 Year 2 coupon
6100 Year 3 coupon
7100 Year 4 coupon
8100 Year 5 coupon
9100 Year 6 coupon
10100 Year 7 coupon
11100 Year 8 coupon
12100 Year 9 coupon
13100 Year 10 coupon
14100 Year 11 coupon
15100 Year 12 coupon
16100 Year 13 coupon
17100 Year 14 coupon
181,100 Year 15 coupon + Principal
19
20$1,000.00=NPV(A2,A4:A18) (entered into Cell A20)
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
215 Number of payments
3100.00$ Payment (coupon amount)
41,000.00$ Future value (principal)
510.0%Interest rate
6
7
81,000.00$ =-PV(A5,A2,A3,A4) (entered into Cell A8)
9
10
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
210.0%RateInterest rate
3
4100$
5100 Year 1 coupon
6100 Year 2 coupon
7100 Year 3 coupon
8100 Year 4 coupon
9100 Year 5 coupon
10100 Year 6 coupon
11100 Year 7 coupon
12100 Year 8 coupon
13100 Year 9 coupon
14100 Year 10 coupon
15100 Year 11 coupon
16100 Year 12 coupon
17100 Year 13 coupon
181,100 Year 14 coupon + Principal
19
20$1,000.00=NPV(A2,A5:A18) (entered into Cell A20)
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
214 Number of payments
3100.00$ Payment (coupon amount)
41,000.00$ Future value (principal)
510.0%Interest rate
6
7
81,000.00$ =-PV(A5,A2,A3,A4) (entered into Cell A8)
9
10
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
25.0%RateInterest rate
3
4100$
5100 Year 1 coupon
6100 Year 2 coupon
7100 Year 3 coupon
8100 Year 4 coupon
9100 Year 5 coupon
10100 Year 6 coupon
11100 Year 7 coupon
12100 Year 8 coupon
13100 Year 9 coupon
14100 Year 10 coupon
15100 Year 11 coupon
16100 Year 12 coupon
17100 Year 13 coupon
181,100 Year 14 coupon + Principal
19
20$1,494.93=NPV(A2,A5:A18) (entered into Cell A20)
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
214 Number of payments
3100.00$ Payment (coupon amount)
41,000.00$ Future value (principal)
55.0%Interest rate
6
7
81,494.93$ =-PV(A5,A2,A3,A4) (entered into Cell A8)
9
10
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
215.0%RateInterest rate
3
4100$
5100 Year 1 coupon
6100 Year 2 coupon
7100 Year 3 coupon
8100 Year 4 coupon
9100 Year 5 coupon
10100 Year 6 coupon
11100 Year 7 coupon
12100 Year 8 coupon
13100 Year 9 coupon
14100 Year 10 coupon
15100 Year 11 coupon
16100 Year 12 coupon
17100 Year 13 coupon
181,100 Year 14 coupon + Principal
19
20$713.78=NPV(A2,A5:A18) (entered into Cell A20)
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
214 Number of payments
3100.00$ Payment (coupon amount)
41,000.00$ Future value (principal)
515.0%Interest rate
6
7
8713.78$ =-PV(A5,A2,A3,A4) (entered into Cell A8)
9
10
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
210.0%Interest rate guess
3
4(1,494.93)$ Bond price
5100 Year 1 coupon
6100 Year 2 coupon
7100 Year 3 coupon
8100 Year 4 coupon
9100 Year 5 coupon
10100 Year 6 coupon
11100 Year 7 coupon
12100 Year 8 coupon
13100 Year 9 coupon
14100 Year 10 coupon
15100 Year 11 coupon
16100 Year 12 coupon
17100 Year 13 coupon
181,100 Year 14 coupon + Principal
19
205.0%=IRR(A4:A18:A2) (entered into Cell A20)
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
214 Number of payments
3(1,494.93)$ Present value (bond price)
4100.00$ Payment (coupon amount)
51,000.00$ Future value (principal)
6
7
85.0%=RATE(A2,A4,A3,A5) (entered into Cell A8)
9
10
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.0% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.00% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
210.0%Interest rate guess
3
4(713.78)$ Bond price
5100 Year 1 coupon
6100 Year 2 coupon
7100 Year 3 coupon
8100 Year 4 coupon
9100 Year 5 coupon
10100 Year 6 coupon
11100 Year 7 coupon
12100 Year 8 coupon
13100 Year 9 coupon
14100 Year 10 coupon
15100 Year 11 coupon
16100 Year 12 coupon
17100 Year 13 coupon
181,100 Year 14 coupon + Principal
19
2015.0%=IRR(A4:A18:A2) (entered into Cell A20)
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.0% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.0% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
ABCD
1
214 Number of payments
3(713.78)$ Present value (bond price)
4100.00$ Payment (coupon amount)
51,000.00$ Future value (principal)
6
7
815.0%=RATE(A2,A4,A3,A5) (entered into Cell A8)
9
10
Sheet1
| CHAPTER 3 | ||||
| Solve Lump Sum FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 133.10 | =100*(1.10)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 133.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $133.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Fv | Future value | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 75.13 | =A3/(1+A4)^A2 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 75.13 | =PV(A4,A2,,-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for I | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Nper | Number of periods | |
| 3 | $ (75.00) | Pv | Present value | |
| 4 | $ 200.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 21.7% | =RATE(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve for N | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 20.0% | Rate | Interest rate | |
| 3 | $ (1.00) | Pv | Present value | |
| 4 | $ 2.00 | Fv | Future value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 3.8 | =NPER(A2,,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 331.00 | =FV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Regular Annuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 10.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 248.69 | =PV(A4,A2,A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due FV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 331.01 | =FV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 331.01 | =FV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Annuity Due PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ (100.00) | Pmt | Payment | |
| 4 | 5.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 285.94 | =PV(A4,A2,A3,,1) (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 285.94 | =PV(A4,A2,A3)*(1+A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Solve Perpetuity PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | $ 100.00 | Payment | ||
| 4 | 10.0% | Interest rate | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =A3/A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| NPV (without initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 CF | ||
| 5 | 300 | Year 2 CF | ||
| 6 | 300 | Year 3 CF | ||
| 7 | (50) | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $530.09 | =NPV(A2,A4:A7) (entered into Cell A10) | ||
| NPV (with initial investment) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | $ 78 | =NPV(A2,A4:A7)+A3 (entered into Cell A10) | ||
| IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 8.0% | Interest rate guess | ||
| 3 | $ (1,500) | Year 0 CF | ||
| 4 | 310 | Year 1 CF | ||
| 5 | 400 | Year 2 CF | ||
| 6 | 500 | Year 3 CF | ||
| 7 | 750 | Year 4 CF | ||
| 8 | ||||
| 9 | ||||
| 10 | 10.0% | =IRR(A3:A7,A2) (entered into Cell A10) | ||
| Solve Lump Sum FV (Annual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 3 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 6.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.10 | =100*(1.06)^3 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.10 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.10 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| Solve Lump Sum FV (Semiannual Compounding) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6 | Nper | Number of periods | |
| 3 | $ 100.00 | Pv | Present value | |
| 4 | 3.0% | Rate | Interest rate | |
| 5 | ||||
| 6 | $ 119.41 | =100*(1.03)^6 (entered into Cell A6) | ||
| 7 | ||||
| 8 | $ 119.41 | =A3*(1+A4)^A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | $ 119.41 | =FV(A4,A2,,-A3) (entered into Cell A10) | ||
| EAR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 3 | Nper | Number of periods | |
| 4 | $ (100.00) | Pv | Present value | |
| 5 | $ 119.41 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 6.09% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Amortization Annuity Payment | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 6.0% | Rate | Interest rate | |
| 3 | 3 | Nper | Number of periods | |
| 4 | $ 1,000,000 | Pv | Present value | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 374,110 | =PMT(A2,A3,-A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 4 | ||||
| ROI 1 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 1,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 5.26% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 2 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 2,000 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | 110.53% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| ROI 3 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | ||||
| 3 | 1 | Nper | Number of periods | |
| 4 | $ (950.00) | Pv | Present value | |
| 5 | $ 0.01 | Fv | Future value | |
| 6 | ||||
| 7 | ||||
| 8 | -100.00% | =RATE(A3,,A4,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 7 | ||||
| Bond Value 1 (15 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate | ||
| 3 | ||||
| 4 | $ 100 | Year 1 coupon | ||
| 5 | 100 | Year 2 coupon | ||
| 6 | 100 | Year 3 coupon | ||
| 7 | 100 | Year 4 coupon | ||
| 8 | 100 | Year 5 coupon | ||
| 9 | 100 | Year 6 coupon | ||
| 10 | 100 | Year 7 coupon | ||
| 11 | 100 | Year 8 coupon | ||
| 12 | 100 | Year 9 coupon | ||
| 13 | 100 | Year 10 coupon | ||
| 14 | 100 | Year 11 coupon | ||
| 15 | 100 | Year 12 coupon | ||
| 16 | 100 | Year 13 coupon | ||
| 17 | 100 | Year 14 coupon | ||
| 18 | 1,100 | Year 15 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 15 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,000.00 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 10.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,000.00 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $1,494.93 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 5.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 1,494.93 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (14 years to maturity and 15% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 15.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | $713.78 | =NPV(A2,A5:A18) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ 100.00 | Payment (coupon amount) | ||
| 4 | $ 1,000.00 | Future value (principal) | ||
| 5 | 15.0% | Interest rate | ||
| 6 | ||||
| 7 | ||||
| 8 | $ 713.78 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond Value (13 years to maturity and 5% required rate) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 5.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ 100 | |||
| 5 | 100 | |||
| 6 | 100 | Value 1 | Year 1 coupon | |
| 7 | 100 | Year 2 coupon | ||
| 8 | 100 | Year 3 coupon | ||
| 9 | 100 | Year 4 coupon | ||
| 10 | 100 | Year 5 coupon | ||
| 11 | 100 | Year 6 coupon | ||
| 12 | 100 | Year 7 coupon | ||
| 13 | 100 | Year 8 coupon | ||
| 14 | 100 | Year 9 coupon | ||
| 15 | 100 | Year 10 coupon | ||
| 16 | 100 | Year 11 coupon | ||
| 17 | 100 | Year 12 coupon | ||
| 18 | 1,100 | Value 1 | Year 13 coupon + Principal | |
| 19 | ||||
| 20 | $1,469.68 | =NPV(A2,A6:A18) (entered into Cell A20) | ||
| Bond Value (Zero coupon) | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ - 0 | Value 1 | Year 1 coupon | |
| 5 | - 0 | Year 2 coupon | ||
| 6 | - 0 | Year 3 coupon | ||
| 7 | - 0 | Year 4 coupon | ||
| 8 | - 0 | Year 5 coupon | ||
| 9 | - 0 | Year 6 coupon | ||
| 10 | - 0 | Year 7 coupon | ||
| 11 | - 0 | Year 8 coupon | ||
| 12 | - 0 | Year 9 coupon | ||
| 13 | - 0 | Year 10 coupon | ||
| 14 | - 0 | Year 11 coupon | ||
| 15 | - 0 | Year 12 coupon | ||
| 16 | - 0 | Year 13 coupon | ||
| 17 | - 0 | Year 14 coupon | ||
| 18 | 1,000 | Value 1 | Year 15 coupon + Principal | |
| 19 | ||||
| 20 | $239.39 | =NPV(A2,A4:A18) (entered into Cell A20) | ||
| Bond YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (1,494.93) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 5.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (1,494.93) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 5.0% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Interest rate guess | ||
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 100 | Year 5 coupon | ||
| 10 | 100 | Year 6 coupon | ||
| 11 | 100 | Year 7 coupon | ||
| 12 | 100 | Year 8 coupon | ||
| 13 | 100 | Year 9 coupon | ||
| 14 | 100 | Year 10 coupon | ||
| 15 | 100 | Year 11 coupon | ||
| 16 | 100 | Year 12 coupon | ||
| 17 | 100 | Year 13 coupon | ||
| 18 | 1,100 | Year 14 coupon + Principal | ||
| 19 | ||||
| 20 | 15.0% | =IRR(A4:A18:A2) (entered into Cell A20) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 14 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,000.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 15.0% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Bond YTC | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Rate | Interest rate | |
| 3 | ||||
| 4 | $ (713.78) | Bond price | ||
| 5 | 100 | Year 1 coupon | ||
| 6 | 100 | Year 2 coupon | ||
| 7 | 100 | Year 3 coupon | ||
| 8 | 100 | Year 4 coupon | ||
| 9 | 1,200 | Year 5 coupon + Prin. + CP | ||
| 10 | ||||
| 11 | ||||
| 12 | ||||
| 13 | ||||
| 14 | ||||
| 15 | 21.1% | =IRR(A4:A9:A2) (entered into Cell A15) | ||
| A | B | C | D | |
| 1 | ||||
| 2 | 5 | Number of payments | ||
| 3 | $ (713.78) | Present value (bond price) | ||
| 4 | $ 100.00 | Payment (coupon amount) | ||
| 5 | $ 1,100.00 | Future value (principal) | ||
| 6 | ||||
| 7 | ||||
| 8 | 21.1% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding PV | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 4 | $ 1,000.00 | Fv | Future value (principal) | |
| 5 | 2.5% | Rate | Interest rate | |
| 6 | ||||
| 7 | ||||
| 8 | $ 1,499.12 | =-PV(A5,A2,A3,A4) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 28 | Nper | Number of payments | |
| 3 | $ (1,400.00) | Pv | Present value (bond price) | |
| 4 | $ 50.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 2.90% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 1.82 | Last dividend payment | ||
| 3 | 10.0% | E(g) | Expected growth rate | |
| 4 | 16.0% | Required rate of return | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | $ 33.37 | =A2*(1+A3)/(A4-A3) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| SML | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 1.6 | b | Beta coefficient | |
| 3 | 5.0% | RF | Risk-free rate | |
| 4 | 12.0% | Required return on the market | ||
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.2% | =A3+(A4-A3)*A2 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Constant Growth Stock Expected Rate of Return | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | $ 33.33 | Stock price | ||
| 3 | $ 2.00 | Next expected dividend | ||
| 4 | 10.0% | E(g) | Expected growth rate | |
| 5 | ||||
| 6 | ||||
| 7 | ||||
| 8 | 16.0% | =A3/A2+A4 (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| Nonconstant Growth Stock Valuation | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 30.0% | Nonconstant growth rate | ||
| 3 | 10.0% | Constant growth rate | ||
| 4 | 16.0% | |||
| 5 | $ 1.82 | Last dividend payment | ||
| 6 | ||||
| 7 | $ 2.366 | =A5*(1+A2) (entered into Cell A7) | ||
| 8 | $ 3.076 | =A7*(1+A2) (entered into Cell A8) | ||
| 9 | $ 3.999 | =A8*(1+A2) (entered into Cell A9) | ||
| 10 | $ 4.398 | =A9*(1+A3) (entered into Cell A10) | ||
| 11 | $ 73.307 | =A10/(A4-A3) (entered into Cell A10) | ||
| 12 | ||||
| 13 | $ 53.85 | =NPV(A4,A7:A9)+PV(A4,3,,-A11) (entered into Cell A13) | ||
| CHAPTER 9 | ||||
| Semiannual Compounding YTM | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 50 | Nper | Number of payments | |
| 3 | $ (1,114.69) | Pv | Present value (bond price) | |
| 4 | $ 35.00 | Pmt | Payment (coupon amount) | |
| 5 | $ 1,000.00 | Fv | Future value (principal) | |
| 6 | ||||
| 7 | ||||
| 8 | 3.05% | =RATE(A2,A4,A3,A5) (entered into Cell A8) | ||
| 9 | ||||
| 10 | ||||
| CHAPTER 11 | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | $ 82,493 | =NPV(A2,A4:A8)+A3 (entered into Cell A10) | ||
| Proj IRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 11.1% | =IRR(A2,A3:A8) (entered into Cell A10) | ||
| Proj MIRR | ||||
| A | B | C | D | |
| 1 | ||||
| 2 | 10.0% | Project cost of capital | ||
| 3 | $ (2,500,000) | Cash flow 0 | ||
| 4 | 510,000 | Cash flow 1 | ||
| 5 | 535,500 | Cash flow 2 | ||
| 6 | 562,275 | Cash flow 3 | ||
| 7 | 590,389 | Cash flow 4 | ||
| 8 | 1,369,908 | Cash flow 5 | ||
| 9 | ||||
| 10 | 10.7% | =MIRR(A3:A8,A2,A2) (entered into Cell A10) |
A
B
C
D
1
2
10.0%
Rate
Interest rate
3
4
(713.78)
$
Values
Bond price
5
100
Values
Year 1 coupon
6
100
Values
Year 2 coupon
7
100
Values
Year 3 coupon
8
100
Values
Year 4 coupon
9
1,200
Values
Year 5 coupon + Prin. + CP
10
11
12
13
14
15
21.1%
=IRR(A4:A9,A2) (entered into Cell A15)
A
B
C
D
1
2
5
Nper
Number of payments
3
(713.78)
$
Pv
Present value (bond price)
4
100.00
$
Pmt
Payment (coupon amount)
5
1,100.00
$
Fv
Future value (principal)
6
7
8
21.1%
=RATE(A2,A4,A3,A5) (entered into Cell A8)
9
10
