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# Components in Calculating the Time Value of Money

All answers should be in a single Excel file.
Show the step by step calculations how it was done and explained thoroughly by using excel:

1 If you deposit \$15,000 today and earn 8% annual interest, how much will you have in 9 years?

2 Tiffany will receive a graduation gift of \$10,000 from her parents in 3 years. If the discount rate
is 7%, what is this gift worth today?

3 What is the present value of a 20-year ordinary annuity of \$30,000 using a 6% discount rate?

4 You deposit \$5,000 in an account that pays 8% interest per annum. How long will it take to double your money?

5 The Johnsons have \$60,000 to use as a down-payment on a house, and they want to borrow \$240,000
from the bank. The current mortgage interest rate is 5%. If they make equal monthly payments for 30 years,
how much will the monthly payment be?

6 Tim paid \$250 per month into his 401K retirement plan. After 30 years, he had accumulated \$500,000. What
average annual rate of interest had he earned over the 30 years?