YEAR TUITION

0
0.5 10000 THIS IS AN ANNUITY
1 10000 APR IS 4%
1.5 10000
2 10000
2.5 10000
3 10000
3.5 10000
4 10000

PV OF ORDINARY ANNUITY FACTOR (1/0.02)-(1/(0.02*(1.02)^8)) 7.32548144049

PV OF ANNUITY 73254.81
IS AN ANNUITY
SO SIX MONTHLY APR IS 2%
EMI
A 30 YEAR
YOU HAVE MADE

YOU CAN USE

PRINCIPAL HAS BEEN REPAID
EXCEL DOES NOT HAVE A FUNCTION TO
ORIGINAL VALUE OF MORTGAGE
PV OF AN ANNUITY OF 2356 FOR 360 MONTHS
ANNUITY FACTOR
INTEREST RATE

INTEREST FACTOR
PV OF ANNUITY ( LOAN PRINCIPAL )

AS THERE ARE 304 EMI S REMAINING

REMAINING VALUE OF LOAN

 2356
MORTGAGE WOULD HAVE 360 PAYMENTS
56 PAYMENTS ALREADY

THE CUMPRINC FUNCTION IN EXCEL TO FIND

TELL YOU HOW MUCH IS OUTSTANDING

$377,642.84

0.06375/12 MONTHLY
0.0053125
(1/0.0053125)-((1/0.0053125*(1.0053125)^360)) 160.289829959222
377642.839383928

THE OUTSTANDING AMOUNT WOULD BE A VALUE EQUAL TO A 304 PERIOD ANNUITY

(1/0.0053125)-((1/0.0053125*(1.0053125)^304)) 150.63667005814
354899.994656978
OUT HOW MUCH
ORIGINAL MORTGAGE VALUE 800000
NO PF PAYMENTS 360
ACTUAL PAYMENTS MADE 222
PAYMENTS REMAINING 138
INTEREST RATE 5.25%
MONTHLY APR 0.004375

MONTLHY INSTALLMENT (₹4,417.63)

REMAINING VALUE OF 138 FUTURE PAYMENTS OF 4418 FOR 138 PERIODS

-456931.4097

SALE PRICE OF HOUSE 1000000

LOAN REPAYMENT 456969
PROFIT ON SALE 543031
TODAY
YOU HAVE 48 EMIS OF $500 REMAINING
INTEREST RATE APR 9%
MONTHLY RATE 0.0075
SO THE PV OF THE LOAN IS $20,092.39
IF YOU PAY AN EXTRA $100 TODAY
YOUR NET LOAN BALANCE WILL BE $19,992.39 TODAY
THE FUTURE VALUE OFTHIS ANNUITY SHOULD BE $28,617.22
HOWEVER YOU WILL KEEP ON PAYING THE SAME EMI OF $500

IF YOU KEEP ON PAYING 48 EMIS THEN THE FINAL BALANCE PAID OFF
SO YOUR LAST INSTALLMENT WILL BE THE DIFFERENCE
WILL BE ₹28,760.36
$143.14 LESS THAN $500
IF YOU PAY $750 PER MONTH
THEN YOU ARE SOLVING FOR N IN THE PRESENT VALUE
PV OF ANNUITY = CASH FLOW* ( ANNUITY FACTOR )
ANNUITY FACTOR 26.7898533333333
WITH AN INTEREST RATE OF 0.0075 SOLVE FOR N APPROX 30 MONTHS
EXACTLY 30.02 MPMTHS
SO YOU PAY A LITTLE MORE THAN 750 IN 3OTH MONTH
OF LESS THAN 750 IN MONTH 31 AS AN EXTRA INSTALLMENT
 ON A LOAN BALANCE OF $20,092.39 SEE PREVIOUS PROBLEM
OF ANNUITY FORMULA

STALLMENT
THE NEW PLAN WILL ALLOW YOU TO

FOR THE ORIGINAL LOAN THE PRINCIPAL SUM

FOR 360 PERIODS INTEREST FACTOR
SO THE PRINCIPAL VALUE BORROWED WAS ₹362,185.18

THE NEW PLAN WILL HAVE THE SAME EAR AS THE OLD ONE

OLD PLAN EAR 0.0537818867274622

NEW PLAN EAR ON FORTNIGHTLY BASIS 0.00201685766980364

NO FO REQUIRED PAYMENTS SOLVE FOR N WITH

651 PAYMENTS
PAY $1000 EVERY 15 DAYS

BORROWED UNDER A $2000 EMI PLAN FOR

0.004375

650.724860355104
25.0384615384615
25 YEARS 2 WEEKS
360 PAYMENTS WAS PV OF ANY ANNUITY
YOUR CARD BALANCE IS

ASSUMING THAT YOU PAY INTEREST ONLY

AS YOUR MOTNHLY APR IS 0.15/12
IF YOU PLAN TO PAY THIS FOREVER THIS IS A PERPETUITY
ON THE NEW CARD THIS PAYMENT SHOULD ALLOW

SO YOU CAN BORROW AN ADDITONAL

FOR A TOTAL BALANCE OF 31250
 25000

EVERY MONTH YOU WILL BE PAYING 312.5

0.0125

YOU TO HAVE A BALANCE OF 31250

6250 ON THE NEW CARD

WE SHALL
NORMALLY
BUT THE RIGHT

SO FOR PART A

PART B
THE BOOK
F(3,2)
BUT WE NEED A
SO WE USE THE

PV OF CASH FLOWS

PART 3

R6
R8
R9
R11
R12
R13
R14
R15
R16
R17
R18
R19
USE DIFFERENT
WE TEND TO
WAY TO DISCOUNT OR COMPOUND

PV WOULD BE

500/(1.0199)^1+500/(1.0241)^2+500/(1.0274)^3+500/(1+R)^4+500/(1.0332)^5
ASKS YOU TO USE INTERPOLATION BUT WE CAN USE FORWARD RATES
1.04196145055928
1 YEAR BORROWING RATE IN YEAR 4 FOR WHICH INFORMATION IS NOT AVAIALABLE
BOOKS INSTRUCTIONS AND INTEROLATE LINEARLY

2296.43452693686

I WILL JUST SHOW THE INTERPOLATIONS YOU CAN EASILY DO THE PV

0.50*3.32+0.50*3.76
2/3*3.76+1/3*4.13
1/3*3.76+2/3*4.13
9/10*4.13+1/10*4.93
8/10*4.13+2/10*4.93
7/10*4.13+3/10*4.93
INTEREST RATES FOR DIFFERENT PERIODS
USE THE SAME INTEREST RATE FOR ALL
IS TO USE DIFFERENT INTEREST RATES

₹2,652.15 2652.15413391248

TO FIND THE INTEREST RATE IN YEAR 4

(((1.0332^5)/(1.0274)^3)^0.5)

3.03

3.54
3.88333333333333
4.00666666666667
4.21
4.29
4.37
4.45
4.53
4.61
4.64
4.77
4.85
AS THE TERM STRUCTURE OF INTEREST RATES ARE DIFFERENT
PERIODS WHEN WE DO NOT HAVE THE TERM STRUCTURE
CORRESPONDING TO DIFFERENT PERIODS AS PER THE TERM STRUCTURE
IGNORE
THE REGULAR SAVINGS ACCOUNT PAYS AN EAR OF
THE EAR ON THE MONEY MARKET ACCOUNT IS 5.390%
AFTER TAX EAR ON THE MONEY MARKET ACCOUNT 3.50%

AFTER TAX RATE OF RETURN = BEFORE TAX RATE OF RETURN *(1-TAX RATE )

CREDIT CARD LOAN COSTS 14.9 % APR

CAR LOAN COSTS 4.8% APR
HOME LOAN APR IS 5%
EAR ON THE HOME LOAN IS 5.12%
AS THE HOME LOAN IS TAX DEDUCTIBLE ITS AFTER TAX COST IS 3.33%

SO YOU SHOULD PAY OFF THE CAR AND CREDIT CARD LOANS BUT KEEP THE HOME LOAN
AS ITS EAR IS LESS THAN THE OPPORTUNITY LOSS IN THE SAVINGS ACCOUNT
IF YOU PREPAY THE HOME LOAN FROM YOUR SAVINGS ACCOUNT
THEN YOU WILL LOSE IN INTEREST MORE THAN THE GAIN IN PREPAYMENT
3.575 PERCENT AFTER TAXES
BEFORE TAXES
THE COMPANY WAS DISPLAYING 90000 POUNDS

THE EAR ON POUND LOAN WAS 0.4074%

WE ARE USING THE POUND INTEREST RATE AS THE DISPLAY WAS IN POUNDS SO LOST

MONTHLY COST OF DISPLAY 366.671140528352 POUNDS

INTEREST SHOULD BE COUNTED IN POUNDS