| UNIT 2: TEXTBOOK PROBLEMS |
| CHAPTER 4: PROBLEM 2 (a through c) |
| | A. | B. | C. |
| Present Value | 3,200 | 3,200 | 3,200 |
| Interest Rate | 6% | 8% | 6% |
| Number of Years | 10 | 10 | 20 |
| Future Value = |
| CHAPTER 4: PROBLEM 3 |
| | A. | B. | C. | D. |
| Future Value = | 15,451 | 51,557 | 886,073 | 550,164 |
| Interest Rate | 7% | 9% | 14% | 16% |
| Number of Years | 12 | 8 | 19 | 24 |
| Present Value = |
| CHAPTER 4: PROBLEM 4 |
| | A. | B. | C. | D. |
| Present Value = | 217 | 432 | 41,000 | 54,382 |
| Future Value | 307 | 896 | 162,181 | 483,500 |
| Number of Years | 3 | 10 | 13 | 26 |
| Interest Rate |
| CHAPTER 4: PROBLEM 5 |
| | A. | B. | C. | D. |
| Present Value = | 625 | 810 | 18,400 | 21,500 |
| Future Value | 1,284 | 4,341 | 402,662 | 173,439 |
| Interest Rate | 9% | 11% | 7% | 10% |
| Number of Years (or Periods) |
| CHAPTER 4: PROBLEM 11 |
| Discount Rate | 5% | 13% | 18% |
| Year 1: | $960 | $960 | $960 |
| Year 2: | $840 | $840 | $840 |
| Year 3: | $1,935 | $1,935 | $1,935 |
| Year 4: | $1,350 | $1,350 | $1,350 |
| Present Value @ 5%, 13%, and 18% = | | | | (Note: Use the built-in NPV formula in Excel.) |
| CHAPTER 5: PROBLEM 2 |
| A. |
| Settlement | | (Think of Settlement as the beginning of the duration of the bond.) |
| Maturity | | (Think of Maturity as the end of the duration of the bond.) |
| Rate | | (Coupon Rate) |
| YTM | | (Yield to Maturity or Required Rate of Return) |
| Redemption | | (Bonds Face Value, Par Value, or Fair Price; Note that is $100, not $1,000. You make the adjustments by multiplying the answer by 10.) |
| Frequency | | (Coupon payments are semiannual, so you put in a 2. If they are annual, then you input a 1.) |
| Basis | | (Always leave it blank.) |
| Bond Price | | (The answer. But you need to multiply it by 10 to get the actual bond price.) |
| Multiply by 10 | | (Microsoft gives the bond price in 2 digits. You need to multiply it by 10 to get the actual bond price.) |
| CHAPTER 5: PROBLEM 3 |
| Settlement | | (Think of Settlement as the beginning of the duration of the bond.) |
| Maturity | | (Think of Maturity as the end of the duration of the bond.) |
| Rate | | (Coupon Rate) |
| Pr | | (The bonds price per $100 face value) |
| Redemption | | (Bonds Face Value, Par Value, or Fair Price; Note that is $100, not $1,000.) |
| Frequency | | (Coupon payments are semiannual, so you put in a 2. If they are annual, then you input a 1.) |
| Basis: | | (Always leave it blank.) |
| YTM |
| CHAPTER 6: PROBLEM 2 |
| Dividend Payment | $1.99 |
| Dividend Growth Rate | 4.50% |
| ZYX Stock Price | $31 |
| Required Return = |
| CHAPTER 6: PROBLEM 4 |
| Dividend | $2.65 |
| Dividend increase per year | 4.75% |
| Required Return (Return on Investment) | 11% |
| Stock Price = |
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cf_template_textbook_problems_unit_2.xls
