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#1
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Financial functions
I have the following data. I do an investment (give a loan) of 1.000.000
Euro. The rate I want is 10%. The period is 5 years. What functions should I use to calculate the sum the customer should pay me after 5 years. And if the customer should pay me in advance what would the sum be then. I have tried myself but I am not sure what to do. I can use the ordinary functions if payment is regular (per month, year etc) but if the payment is in the beginning or at the end of a 5 year period I do not know how to solve the problem. Steffen |
#2
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Financial functions
Sun, 9 Dec 2007 02:07:01 -0800 from Steffen
: I have the following data. I do an investment (give a loan) of 1.000.000 Euro. The rate I want is 10%. The period is 5 years. What functions should I use to calculate the sum the customer should pay me after 5 years. And if the customer should pay me in advance what would the sum be then. This depends on the method of accruing or calculating interest. It should be stated in the loan documents, but if it's not there then national law probably specified. For example, interest might be accrued annually on the first day or the year. In that case, the amount due is the same on the first through 365th day of each year. Or it might be accrued on the first or last day of each month, Or it might be accrued and compounded daily, or accrued daily but compounded monthly, or ... Since a million euro are involved, you need to check the loan documents and applicable law carefully. -- Stan Brown, Oak Road Systems, Tompkins County, New York, USA http://OakRoadSystems.com/ "If there's one thing I know, it's men. I ought to: it's been my life work." -- Marie Dressler, in /Dinner at Eight/ |
#3
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Financial functions
The future value of your loan is:
=fv(10%,5,0,1000000) =1,610,510 Euro If the customer pays you in advance, for example, after 3 years, just put the period into the formula, as in: =fv(10%,3,0,1000000) =1,331,000 FV will also accept non-integer periods, so if he pays you back after 3 years and 8 months, use a period of 3.75 years. -- Regards, Fred "Steffen" wrote in message ... I have the following data. I do an investment (give a loan) of 1.000.000 Euro. The rate I want is 10%. The period is 5 years. What functions should I use to calculate the sum the customer should pay me after 5 years. And if the customer should pay me in advance what would the sum be then. I have tried myself but I am not sure what to do. I can use the ordinary functions if payment is regular (per month, year etc) but if the payment is in the beginning or at the end of a 5 year period I do not know how to solve the problem. Steffen |
#4
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Financial functions
Hi Fred!
Thank you. It was unclear for me but as I understand your answer I can use zero in payment and 5 which will represent yearperiod. Best regards Steffen "Fred Smith" skrev: The future value of your loan is: =fv(10%,5,0,1000000) =1,610,510 Euro If the customer pays you in advance, for example, after 3 years, just put the period into the formula, as in: =fv(10%,3,0,1000000) =1,331,000 FV will also accept non-integer periods, so if he pays you back after 3 years and 8 months, use a period of 3.75 years. -- Regards, Fred "Steffen" wrote in message ... I have the following data. I do an investment (give a loan) of 1.000.000 Euro. The rate I want is 10%. The period is 5 years. What functions should I use to calculate the sum the customer should pay me after 5 years. And if the customer should pay me in advance what would the sum be then. I have tried myself but I am not sure what to do. I can use the ordinary functions if payment is regular (per month, year etc) but if the payment is in the beginning or at the end of a 5 year period I do not know how to solve the problem. Steffen |
#5
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Financial functions
As you stated in your post, there are no payments until the end, so the PMT
amount is zero. And again, as you said, the term is 5 years, so NPER is 5. -- Regards, Fred "Steffen" wrote in message ... Hi Fred! Thank you. It was unclear for me but as I understand your answer I can use zero in payment and 5 which will represent yearperiod. Best regards Steffen "Fred Smith" skrev: The future value of your loan is: =fv(10%,5,0,1000000) =1,610,510 Euro If the customer pays you in advance, for example, after 3 years, just put the period into the formula, as in: =fv(10%,3,0,1000000) =1,331,000 FV will also accept non-integer periods, so if he pays you back after 3 years and 8 months, use a period of 3.75 years. -- Regards, Fred "Steffen" wrote in message ... I have the following data. I do an investment (give a loan) of 1.000.000 Euro. The rate I want is 10%. The period is 5 years. What functions should I use to calculate the sum the customer should pay me after 5 years. And if the customer should pay me in advance what would the sum be then. I have tried myself but I am not sure what to do. I can use the ordinary functions if payment is regular (per month, year etc) but if the payment is in the beginning or at the end of a 5 year period I do not know how to solve the problem. Steffen |
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