Excel - Ch 7

Question 1

Calculates total current value of loan/investment (with fixed rate, set payments & periods)

Answer 1

Present Value (PV)

Question 2

=PV(rate,nper,pmt,[fv],[type])

Answer 2

PV Function

Question 3

Calculates future value of investment/loan (with fixed rate, set payments & periods)

Answer 3

Future Value (FV)

Question 4

=FV(rate,nper,pmt,[pv],[type]

Answer 4

FV Function

Question 5

Calculates net present value of invenstment/loan (with fixed rate and future payments)

Answer 5

New Present Value (NPV)

Question 6

=NPV(rate,value1,[value2])

Answer 6

NPV Function

Question 7

Interest rate for 1 period; aka rate of return / % of return investment; often divided by annual rate

Answer 7

Rate

Question 8

Represent sequence of payments & income during investment period; to provide accurate net present value; cash flow must occur at equally spaced times during periods & must occur at the end of each period

Answer 8

Value 1 (NPV)

Question 9

Calculates # of payment periods for investment/loan (given fixed rate, periodic payment, present value)

Answer 9

NPER

Question 10

=NPER(rate,pmt,pv,[fv],[type])

Answer 10

NPER Function

Question 11

Calculates periodic rate for investment/loan (given payment periods, fixed payments, present value)

Answer 11

RATE

Question 12

=RATE(nper,pmt,pv,[fv],[type])

Answer 12

RATE Function

Question 13

Schedule that calculates interest per period, principle repayment for each payment, and remaining balance after each payment is made

Answer 13

Loan Amortization Table

Question 14

Calculates payments for a loan with a fix amount, fixed periodic rate, for fixed time; insert - symbol in function to make result a positive result

Answer 14

Payment (PMT)

Question 15

=PMT(rate,nper,pf,[fv],[type])

Answer 15

PMT Function

Question 16

Calculates periodic interest rate for specified payment period on loan/investment given a fixed interest rate, specified term, identical periodic payments, and present value

Answer 16

Interest Payment (IPMT)

Question 17

=IPMT(rate,per,nper,pv,[fv],[type])

Answer 17

IPMT Function

Question 18

Specific payment period used to calculate the interest rate where the 1st payment period is 1; best to include payment # column (can use relative cell references)

Answer 18

Per

Question 19

Represents the # of payment periods; should perform the calculation using absolute input cell references

Answer 19

Nper

Question 20

(Optional); Represents timing of the payments; 0 is end of period, 1 is start of period; 0 is default

Answer 20

Type

Question 21

Calculates principle payment for specified payment period on the loan/investment given a fixed interest rate, specified term, identical periodic payments; include - in function to create positive result

Answer 21

Principle Payment (PPMT)

Question 22

=PPMT(rate,per,nper,pf,[fv],[type])

Answer 22

PPMT Function

Question 23

Use to calculate cumulative interest paid through specific period; function accumulates the interest paid between selected payments or throughout entire loam; can specify between certain dates if you don’t want calculate the entire amount; use negative at start of function to present as positive

Answer 23

Cumulative Interest Payment (CUMIPMT)

Question 24

=CUMIPMT(rate,nper,pv,start_period,end_period,type)

Answer 24

CUMIPMT Function

Question 25

Use to calculate the cumulative principle through a specified payment period; accumulates the principle repayment between selected payments or throughour entire loan; for first payment, cumulative principle paid is the same as the first principle payment; use negarive at start of function to present as positive

Answer 25

Cumulative Principle Payment (CUMPRINC)

Question 26

=CUMPRINC(rate,nper,pv,start_period,end_period,type)

Answer 26

CUMPRINC Function