PRESENT & FUTURE VALUE CALCULATION

time amnt present value

1 2000 2195
2 2000 4604.0125
3 2000 7247.90371875
4 2000 10149.5743313281
5 2000 13334.1578286326
6 2000 16829.2382169243
7 2000 20665.0889430744
8 2000 24874.9351150242
9 2000 29495.241288739
10 2000 34566.0273143911
11 2000 40131.2149775442
12 2000 46239.0084378547

rate 9.75%
time 12
principle 2000
sinking fund Rs. 7,120.61
future value of a single cash flow Rs. 42,131.21
present value of single cash flow Rs. 13,795.89

CALCULATION OF EMI & %RATE

machine down payment balance payment
600000 150000 450000
1000000 200000 800000
1000000 200000 800000

NPV, IRR & PI CALCULATION

NPV=[=NPV((cash inflows)]
IRR= [=IRR((outflow)*inflows]
PI=present value of future cash flow/intial investment

rate 18.00%
yr cash flow
0 -100000
 1 40000 NPV
2 50000 PI
3 60000 IRR
4 20000

rate 10.00%
yr cash flow
0 -100000
1 40000 NPV
2 30000 IRR
3 50000 PI
4 20000

PRESENT & FUTURE VALUE ( annualy, semiannualy,quarterly, month

rate 10.00%
yr amnt to be rcvd at the end of each year
1 10000
2 10000
3 10000

ANNUALY
PRESENT VALUE 24868.52
FUTURE VALUE 33100.00

SEMIANNUALY
PRESENT VALUE 50756.92
FUTURE VALUE 68019.13

QUARTERLY
PRESENT VALUE 102577.65
FUTURE VALUE 137955.53

MONTHLY
PRESENT VALUE 309912.36
FUTURE VALUE 417818.21

DAILY
PRESENT VALUE 9459023.90
FUTURE VALUE 12767822.10

MANNUALY CALCULATION OF PRESENT VALUE & FUTURE VALUE

ANNUALY
Rate 10%
YR AMNT PVIF=1/(1+R)ᶯ
1 10000 0.909090909090909
2 10000 0.826446280991735
3 10000 0.751314800901578

SEMIANNUALY
Rate 10%
YR AMNT PVIF=1/(1+R)ᶯ
1 10000 0.952380952380952
2 10000 0.90702947845805
3 10000 0.863837598531476
4 10000 0.822702474791882
5 10000 0.783526166468459
6 10000 0.746215396636627

QUARTERLY
Rate 10%
YR AMNT PVIF=1/(1+R)ᶯ
1 10000 0.975609756097561
2 10000 0.951814396192742
3 10000 0.928599410919749
4 10000 0.905950644799755
5 10000 0.883854287609517
6 10000 0.862296865960505
7 10000 0.841265235083419
8 10000 0.820746570813092
9 10000 0.80072836176887
10 10000 0.781198401725727
11 10000 0.762144782171441
12 10000 0.743555885045309
CULATION

% rate EMI time

12.17% ? 6
? 70000 8
? 110000 8
 116641.16
1.1664115643662
26.69%

112383.03
16%
1.12

miannualy,quarterly, monthly, daily)

DIRECT METHOD
PVAF==> CASH FLOW*(1+R)ᶯ-1/R*(1+R)ᶯ

PVAF==> 24868.5199098422
ALUE & FUTURE VALUE

PRESENT VALUE ANNUALY FUTURE VALUE FUTURE VALUE ANNUALY

9090.90909090909 1.21 12100
8264.46280991735 1.1 11000
7513.14800901578 1 10000
24868.5199098422 33100

PRESENT VALUE SEMIANNUALY FUTURE VALUE FUTURE VALUE SEMIANNUALY

9523.80952380952 1.2762815625 12762.815625
9070.2947845805 1.21550625 12155.0625
8638.37598531476 1.157625 11576.25
8227.02474791882 1.1025 11025
7835.26166468459 1.05 10500
7462.15396636627 1 10000
50756.9206726745 68019.128125

PRESENT VALUE QUARTERLY FUTURE VALUE FUTURE VALUE QUARTERLY

9756.09756097561 1.31208665780127 13120.8665780127
9518.14396192743 1.28008454419636 12800.8454419636
9285.99410919749 1.24886296994767 12488.6296994767
9059.50644799755 1.21840289750992 12184.0289750992
8838.54287609517 1.18868575366821 11886.8575366821
8622.96865960505 1.15969341821289 11596.9341821289
8412.65235083419 1.13140821289062 11314.0821289062
8207.46570813092 1.103812890625 11038.12890625
8007.28361768871 1.076890625 10768.90625
7811.98401725727 1.050625 10506.25
7621.44782171441 1.025 10250
7435.55885045309 1 10000
102577.645981877 137955.529698519
 result
Rs. 109,979.06
-7%
2%
Ques- Supoose you are consodering the purchase of a 5 yr bond that pays an annual coupon payment of 7% .
What would you pay forthed bond if you demand a return of 9%. Do the same thnig for 5 yr and 10 yr & also calcula
calculate the value of the bond if the interst rate rises to 10% and also calculate the value of the bond if the interest rat
sensitivity of a bond with the chnges in interest rate (explain the relationship between bond prices and interest rates)

Answer Coupon rate ==> 7%

Face value ==> 1000

5 yr bond at 9% ==> 922.207

10 yr bond at 9% ==> 871.6468

% change for 5 ye & 10 yr bond 5.482514

5 yr bond at 8% ==> 960.0729

5 yr bond at 10% ==> 886.2764

Note- Sensitivity of a bond is depend on the interest rate on bond . Interest rate and bond pric
interest rate rises bond price decreases.
al coupon payment of 7% .
r 5 yr and 10 yr & also calculate % change for 5 yr n 10 yr bond
e of the bond if the interest rate falls to 8% you are also required to comment on the
ond prices and interest rates)

bond price ∞ 1/interest rate

. Interest rate and bond price are inversely proportional to each other. As the