In Excel What is the present value factor for 4 years if int

~~~~In Excel~~~

-What is the present value factor for 4 years if interest rate is 7.9%? Show how you found the value.

-What should be input for the Excel function PV if you are trying to find present value of $100 coming in 5 years time when interest rate is 10%?

-What can you do to check if there are multiple IRRs for a project in Excel?

Solution

1 Interest rate 7.9% Time 4 PV factor $0.73776 Formula = PV(7.9%,4,0,-1,0) $0.73776 2 PMT 100 Time 5 Rate 10% UsIng PV funcion in excel PV $379.08 Formula = PV(10%,5,100) Lets take an example to find multiple IRR A B C D E F G Year 0 1 2 3 4 5 6 1 Cash flows -5000 2800 2800 2800 2800 2800 -9300 Now we take guess values raning from 0% to 50% in steps of 5% Guess Values Multiple IRR Formula = IRR(A1:G1,Guess Values) 0% 2.6% IRR(A1:G1,0%) 5% 2.6% IRR(A1:G1,5%) 10% 2.6% IRR(A1:G1,10%) 15% 27.4% IRR(A1:G1,15%) 20% 27.4% IRR(A1:G1,20%) 25% 27.4% IRR(A1:G1,25%) 30% 27.4% IRR(A1:G1,30%) 35% 27.4% IRR(A1:G1,35%) 40% 27.4% IRR(A1:G1,40%) 45% 27.4% IRR(A1:G1,45%) 50% 27.4% IRR(A1:G1,50%)