Calculate the internal rate of return of an investment of


IT Software for Business - Assignment

• Word Exercise: Create a professional curriculum vitae, including a picture and at least 2-3 educational institutions and work experience (if you do not have enough, feel free to invent them).

• PowerPoint Exercise: Create a PowerPoint presentation about your hometown/country using the features of the program (pictures, transitions, animation, styles, lists etc).

• Excel Exercise: Solve the following problems in one Excel Sheet, having each exercise on a separate sheet.

When you have finished the three exercises, upload them to Moodle, you have time to do so until the last class of the semester.

Exercise 1

Create a Personal Budget Sheet, including the following categories:

- In rows:

• INCOME:

- Salary, Public Assistance, Food Stamps, Other. Total Income

• EXPENSES:

- Living/Housing: Rent/Mortgage, Electric, Water/Sewer, Gas/Heating, Telephone, Cable TV, Household/Repairs, Other. Total Housing.

- Regular Payments: Student Loan, Credit Cards, Other Loan Payments, Health Insurance, Car/Home Insurance: Life Insurance, Child Care, Other. Total Regular payments.

- Food Expenses: Groceries, Restaurant Meals, Other. Total Food.

- Personal Expenses: Personal Care, Hair/Nail Care, Clothing/Shoes, Doctors, Prescriptions, Laundry/Dry Clean, Recreation/Travel, Other. Total Personal.

- Transportation: Gas/Auto Expenses, Bus, Taxi, Train, etc., Parking, Other - Miscellaneous: Church, Gifts/Charity, Savings, Other. Total Personal.

- Total Expenses

• TOTAL INCOME MINUS TOTAL EXPENSES

- In columns: the 12 months of the year. - Include also the grand total.

IT Software for Business - Assignment

Exercise 2

A survey has been completed by 30 families. Their responses for "number of children" are the following:

1, 1, 2, 3, 0, 0, 1, 2, 3, 1, 4, 3, 2, 2, 1, 0, 2, 1, 5, 1, 2, 1, 3, 2, 0, 6, 2, 1, 1, 0

1) Introduce these numbers in an Excel table and calculate the the following statistical data: minimum, maximum, average, median, mode.

2) Use conditional formatting (on the original data) to highlight the cells with numbers grater than 2.

3) Create the following table next to the data displayed with the following information:

Number of Children        Number of families
0                                          ....
1                                          ....
2                                          ....
3                                          ....
4                                          ....
5                                          ....
6                                          ....

With the second column containing the number of families having 0, 1, ..., 6 children.

4) Show the last results in a Pie Chart.

Exercise 3

Suppose that we have an annual interest rate of 6%.

1) Calculate the present value of 200€ payments at the end of each month (type 0), during 2 years.

2) Calculate the future value of 50€ payment at the beginning of each year (type 1), during 10 years.

3) Calculate the internal rate of return of an investment of 3000€, if we get 950€, 930€, 800€ and 528€ in the following periods.

4) Calculate the internal rate of return of an investment of 5000€ on 1st January 2013, if we get 1900€ on 14th February 2013, 1640€ on 25th March 2013 and 1500€ 12th May of 2013.

5) Compare the net present value of the following two investment possibilities:

A: to invest 4000€ now and get 1000€, 1800€, 1500€ and 300€ in the next years,

B: to invest 5000€ now, and get 1300€, 1350€, 1400€ and 1450€ in the next years if we suppose that there is a 2% of annual interest rate.

Exercise 4

1) Which would you choose of the following two options?

A: to get 20,000€ in 4 years,

B: to get 1000€ now and 1000€ at the end of in each quarter during four years (future value, suppose that there is 8% of annual interest rate).

Which would you choose, if the interest rate were 7% annual?

2) Which would you choose of the following two options?

A: to get 7,300€ now, or
B: to get 240 at the beginning of each month (type 1), for three years, supposing that there is a 12% of annual interest rate.

3) Which would you choose of the following two options, if you had 10,000€ to invest:

A: a savings account with 5,5% of interest rate
B: a return of 2000€ annually in the following 6 years (use IRR).

4) Compare the internal rate of return of the following investment opportunities

 

Data

A

B

C

Investment

01/01/2013

-5000

-6000

-5500

Return

25/03/2013

1800

2000

1900

 

10/07/2013

1600

1830

1700

 

20/10/2013

1300

1600

1000

 

31/12/2013

500

800

1145

Functions used:

MAX, MIN, SUM, AVERAGE, MODE, MEDIAN, COUNTIF, PV, FV, IRR, XIRR, NPV.

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Financial Management: Calculate the internal rate of return of an investment of
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