Loan Amortization
Your company is planning to borrow $0.75 million on a 9-year, 16%, annual payment, fully amortized term loan. What fraction of the payment made at the end of the second year will represent repayment of principal? Round your answer to two decimal places.
Can this or can it not be a problem solved without excel?.
Uneven Cash Flow Stream
Find the present values of the following cash flow streams. The appropriate interest rate is 14%. Round your answers to the nearest cent.
(Hint: It is fairly easy to work this problem dealing with the individual cash flows. However, if you have a financial calculator, read the section of the manual that describes how to enter cash flows such as the ones in this problem. This will take a little time, but the investment will pay huge dividends throughout the course. Note that, when working with the calculator's cash flow register, you must enter CF0 = 0. Note also that it is quite easy to work the problem with Excel, using procedures described in the Chapter 4 Tool Kit.)
| Year |
Cash Stream A |
Cash Stream B |
| 1 |
$100 |
$300 |
| 2 |
400 |
400 |
| 3 |
400 |
400 |
| 4 |
400 |
400 |
| 5 |
300 |
100 |
Stream A $
Stream B $