Friday, May 2, 2008
Assignment for 5_1_08
Principal: 35000
Rate: 0.064
Time: 5
=48199.47
For monthly payments divide by 60
=803.32
35000 with 6.4% for 5 years
Even though the monthly payments would be cheaper, since you are taking out more
money, you would be paying more money in the long run, by almost $7000.
Principal: 35000
Rate: 0.059
Time: 3
=41777.09
For monthly payments divide by 36
=1160.47
35000 with 5.9% for 3 years
Even though the monthly payments would be more expensive, you would be paying less in
the long run.
NPV
For Option A you would see a profit of $477.09
For Option B you would see a profit of $161.66
For Option C you would see a debt of $849.69
For Option D you would see a debt of $1601.95
MIRR
For Option A you would see 6%
For Option B you would see 6%
For Option C you would see 4%
For Option D you would see 3%
Evaulation:
Option A and Option B would be better, not only are they returning a profit but their
MIRR is the higher percentage. Though Option A would be the best option and make the
most money back.
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1 comment:
Excellent analyses and writeups. You're not wrong about profit/loss with NPV. Often, it's just stated as a positive or negative number and interpreted by it being > < or = 0.
Excellent dashboard for EA. Excellent work.
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