A. Wissler, Inc. owes $273,000 to the bank for some improvements made to its office building. The...

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Finance

A.
Wissler, Inc. owes $273,000 to the bank for some improvementsmade to its office building. The loan is for 60 months and themonthly payment is $5,945.79 What is the interest rate on theloan?
B.
Huggins Co. has identified aninvestment project with the following cash flows.

Year Cash Flow
1 $ 790
2 1,070
3 1,330
4 1,450

If the discount rate is 9 percent, what is the present value ofthese cash flows? (Do not round intermediate calculationsand round your answer to 2 decimal places, e.g.,32.16.)

  Present value $

What is the present value at 17 percent? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)

  Present value $

What is the present value at 25 percent? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)

  Present value $

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4.0 Ratings (529 Votes)

Wissler, Inc. owes $273,000 to the bank for some improvements made to its office building. The loan is for 60 months and the monthly payment is $5,945.79 What is the interest rate on the loan?

RATe	?
NPER	60
PV	273000
FV	0
PMT	5945.79
=RATE(60,5945.79,-273000,0,0)*12	11.07%

Huggins Co. has identified an investment project with the following cash flows.

If the discount rate is 9 percent, what is the present value of these cash flows?

		PV factor 9%	PV
1	790	0.917431	724.77
2	1070	0.841680	900.60
3	1330	0.772183	1027.00
4	1450	0.708425	1027.22
	Present value		3679.59

What is the present value at 17 percent?

		PV factor17%	PV
1	790	0.854701	675.21
2	1070	0.730514	781.65
3	1330	0.624371	830.41
4	1450	0.533650	773.79
	Present value		3061.07

What is the present value at 25 percent?

		PV factor17%	PV
1	790	0.800000	632.00
2	1070	0.640000	684.80
3	1330	0.512000	680.96
4	1450	0.409600	593.92
	Present value		2591.68

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