Investment descriptions usually provide all of the information you need to make a decision about the product. That information includes the initial investment, ongoing payments, interest rate, length of the investment, and final return. If you receive information about an investment that has the number of periods missing, you can calculate the missing value by using the NPER function.
- [Instructor] Investment descriptions usually provide…all of the information you need to make a decision…about the product.…That information includes the initial investment,…ongoing payments, interest rate, the life of the investment,…and final return.…IF you receive information about an investment…that has the number of periods missing,…you can use the other information…to calculate the missing value by using the NPER function.…In this movie, I will show you the number of periods…required to meet an investment goal.…My sample file is NumberOfPeriods_01_08…and you can find it in the chapter one folder…of your exercise files collection.…
To calculate the number of periods required…to meet an investment goal, you need to know…five different things.…The first is the annual interest rate, that's in C3,…and that is the annual rate of the investment.…In C4, I have the second argument, payment each period.…If you are making payments into a fund,…then this is the amount that will be coming in…on a regular basis.…Next is the present value, that is the amount of your…
- Recall what the type argument is used to determine when using the PMT function.
- Identify what the M stands for in the ACCRINTM function.
- Name the accounting rules used by the AMORDEGRC function to assign a depreciation coefficient to an asset.
- Recall what internal rate of return generated by the IRR function should be measured against to determine if it is a good investment.
- List the three regular intervals that coupon bonds pay interest at.
- Determine the function that provides a more conservative bond evaluation compared to the DURATION function.
- Explain what the RECEIVED function shows.
Skill Level Intermediate
1. Analyzing Loans, Payments, and Interest
2. Calculating Depreciation
3. Determining Values and Rates of Return
4. Calculating Bond Coupon Dates and Security Durations
5. Calculating Security Prices and Yields
6. Analyzing Simulation Results
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