FINANCIAL MANAGEMENT

TUGAS SESI 2: BAB 4-5

Kelompok 5
Nama : Dewi Amelia
Mirza Zulkarnain
Rieza Sidafril Febianti
Unggul Satriya Anugrah
Kelas : Eksekutif B 39 E

CHAPTER 4: Time Value of Money

4-5 0 1 2 N–2 N–1 N
12%
| | | ••• | | |
PV = 42,180.53 5,000 5,000 5,000 5,000 FV = 250,000
I/YR = 12; PV = -42180.53; PMT = -5000; FV = 250000; N = ?
Solve for N with financial calculator = 11. It will take 11 years to accumulate $250,000.

4-19 a. Universal Bank: Effective rate = 7%.

Regional Bank:
4
 0.06 
Effective rate = 1 +  - 1.0 = (1.015)4 – 1.0
 4 
= 1.0614 – 1.0 = 0.0614 = 6.14%.

Deposit money in Universal Bank is the best option.

b. Choose a Regional account is the right choice if funds must be left on deposit during an
entire compounding period in order for to receive any interest (1 year for Universal and 1
quarter for Regional). Assuming that it is high possibility to make a withdrawal during the
year. For example, if the withdrawal is made after 10 months, it would earn nothing on
the Universal account but (1,015) 3 - 1.0 = 4.57% on the Regional account.

4-20 a. N = 5, I/YR = 10, PV = -25000, and FV = 0,

PMT = $6,594.94.

Payment Repayment Remaining of Balance

Year Interest Principal
$ $ $ $
1 6,594.94 2,500.00 4,094.94 20,905.06
2 6,594.94 2,090.51 4,504.43 16,400.63
3 6,594.94 1,640.06 4,954.88 11,445.75
4 6,594.94 1,144.58 5,450.36 5,995.39
5 *6,594.93 599.54 5,995.39 0
32,974.69 7,974.69 25,000.00
 *The last payment must be smaller to force the ending balance to zero.

b. The loan size is doubled $50,000

N = 5, I/YR = 10, PV = -50000, and FV = 0
PMT = $13,189.87.

c. N = 10, I/YR = 10, PV = -50000, and FV = 0

PMT = $8,137.27

Since the payments are spread out over a longer time period, more interest must be paid
on the loan, which raises the amount of each payment.
10-year loan 5-year loan
10($8,137.27) - $50,000 5($6,594.94) - $50,000
= $31,372.70 = $15,949.37

CHAPTER 5: Bonds, Bond Valuation, and Interest Rates

5-12 a. N = 20, PV = -1100, PMT = 60, FV = 1000

I/YR = 5.185%.

Since this is a periodic rate so the nominal annual rate = 5.185%(2) = 10.37%.

b. The current yield = $120/$1,100 = 10.91%.

c. YTM = Current Yield + Capital Gains (Loss) Yield

10.37% = 10.91% + Capital Loss Yield

-0.54% = Capital Loss Yield.

d. N = 8, PV = -1100, PMT = 60, FV = 1060

I/YR = 5.075%.

Since this is a periodic rate so the nominal annual rate = 5.075%(2) = 10.15%.

5-16

Price at 8% Price at 7%
% change
$ $
10-year, 10% annual coupon 1,134.20 1,210.71 6.75%

10-year zero 463.19 508.35 9.75%

5-year zero 680.58 712.99 4.76%

30-year zero 99.38 131.37 32.19%

$100 perpetuity 1,250.00 1,428.57 14.29%