1.) Repayment of a loan requires the periodic payment of
interest and principal. You are interested in the amount of
principal you pay in the 60th period of a loan. We can use the PPMT
(rate, per, nper, pv, [fv], [type]) function for this purpose.
Assume the following parameters for the loan and PPMT function:
rate = 40% (annual rate – don’t forget to divide by 12 in PPMT
function to match monthly input data — per, nper)
per = 60th month
nper = 360 month
pv = $150,000
Create a two – way data table for the calculation of the
principal payment for the 60th period for a variety of annual
interest rates (rate = 4.0 to 6.5%, 0.5% increments as row value)
and present values of the loan (pv = 150,000 to 250,000, in 25,000
increments as column value).
Format results such that you have two decimals (123.45).
(Hint: Your principal in the 60th period should be $438.35 for
the data above).
| rate= | 0.0400 | ||||||
| per= | 60 | ||||||
| nper= | 360 | ||||||
| pv= | 250000 | ||||||
| PPMT==> | |||||||
| Interest | |||||||
| Principal | |||||||
