QRB501_r10_Wk5_Quantitative_Techniques_in_Financial_Valuation_Problem_Set_Excel_Template.xlsx

PROBLEM 1

Find the interest paid on a loan of $1,200 for three years at a simple interest rate of 5% per year.

How much money will you pay after three years?

PROBLEM 2

Find the maturity value of a loan of $1,750 for 28 months at 9.8% simple interest per year.

PROBLEM 3

Find the simple interest rate of a loan of $5,000 that is made for three years and requires $1,762.50 in interest. 

PROBLEM 4

A loan of $16,840 is borrowed at 9% simple interest and is repaid with $4,167.90 interest. 

What is the duration of the loan? (compute the number of years as a decimal value and the duration in months)

PROBLEM 5

How much money is borrowed if the interest rate is 9.25% simple interest 

and the loan is made for 3.5 years and has $904.88 interest? 

PROBLEM 6

Find the ordinary and exact interest for a loan of $1000 at a 5% annual 

interest rate. The loan was made on March 15 and is due May 15.

PROBLEM 7

Find the bank discount and proceeds using ordinary interest for a loan to Michelle Anders for $7,200

at 8.25% annual simple interest from August 8 to November 8.

PROBLEM 8

What is the effective interest rate of a simple discount note for $8,000, 

at an ordinary bank discount rate of 11%, for 120 days? 

PROBLEM 9

1. Ross Land has a loan of $8,500 compounded quarterly for four years at 6%. What is the effective interest rate for the first year for the loan? 

2. Find the effective interest rate for the first year for a loan for four years compounded semiannually at an annual rate of 2%

3. What is the effective interest rate for the first year for a loan of $5,000 at 10% compounded daily for three years?

4. Depending on the issuer, a typical credit card agreement quotes an interest rate of 18 percent APR. Monthly payments are required. 

What is the actual interest rate you pay on such a credit card?

5. Find the effective interest rate for a loan of $3,500 at 10% interest compounded quarterly. 

PROBLEM 10

Find the future value of a $15,000 money market investment at 2.8% annual interest compounded daily for three years. 

PROBLEM 11

How much should be invested now to have $15,000 in six years if interest is 4% compounded quarterly?

PROBLEM 12

How much must be invested today at 2% annual interest compounded 

semiannually to have the needed funds? 

A loan of $8,000 for two acres of woodland is compounded quarterly at an annual 

rate of 6% for five years. Find the compound amount and the compound interest.