Time Value of Money必看课件资料.ppt

Ehrhardt Chapter 2 Page Future value Present value Rates of return Amortization Time lines show timing of cash flows. Time line for a $100 lump sum due at the end of Year 2. Time line for an ordinary annuity of $100 for 3 years. Time line for uneven CFs: -$50 at t = 0 and $100, $75, and $50 at the end of Years 1 through 3. What’s the FV of an initial $100 after 3 years if i = 10%? Solve the equation with a regular calculator. Use a financial calculator. Use a spreadsheet. Adjust display contrast: hold down CLR and push + or -. Choose algebra mode: Hold down orange key (i.e., the shift key), hit MODES (the shifted DSP key), and select ALG. Set number of decimal places to display: Hit DSP key, select FIX, then input desired decimal places (e.g., 3). Set decimal mode: Hit DSP key, select the “.” instead of the “,”. Note: many non-US countries reverse the US use of decimals and commas when writing a number. Hit EXIT until you get the menu starting with FIN. Select FIN. Select TVM. Select OTHER. Select P/YR. Input 1 (for 1 payment per year). Select END (for cash flows occuring at the end of the year.) Use the FV function: see spreadsheet in Ch 02 Mini Case.xls. = FV(Rate, Nper, Pmt, PV) = FV(0.10, 3, 0, -100) = 133.10 What’s the PV of $100 due in 3 years if i = 10%? Use the PV function: see spreadsheet. = PV(Rate, Nper, Pmt, FV) = PV(0.10, 3, 0, 100) = -75.13 Use the NPER function: see spreadsheet. = NPER(Rate, Pmt, PV, FV) = NPER(0.10, 0, -1, 2) = 3.8 Use the RATE function: = RATE(Nper, Pmt, PV, FV) = RATE(3, 0, -1, 2) = 0.2599 What’s the FV of a 3-year ordinary annuity of $100 at 10%? The future value of an annuity with n periods and an interest rate of i can be found with the following formula: Use the FV function: see spreadsheet. = FV(Rate, Nper, Pmt, Pv) = FV(0.10, 3, -100, 0) = 331.00 What’s the PV of this ordinary annuity? The present value of an annuity with n periods and an interest rate of i can be found with the followin