Develop an e?ective interest rate calculator.

Assignment Help Financial Econometrics

Reference no: EM131198000

Question 1

a. Use Goal seek to solve the question in a spreadsheet. Make sure you carefully document the steps you used in the spreadsheet.

b. Use Solver to solve the question in a spreadsheet. Make sure you carefully document the steps you used in the spreadsheet.

Next, develop an e?ective interest rate calculator.

c. The calculator you develop should satisfy the following speci?cations.

In the top cell the user enters the percentage nominal rate (like 7%).
In the next cell the user enters the annual frequency of the nominal rate, i.e., the n from j_n.
In the next cell the spreadsheet calculates the effective daily rate of interest. (Assume 365 days in a year.)
In the next cell the spreadsheet calculates the effective weekly rate of interest. (Assume 52 weeks in a year.)
In the next cell the spreadsheet calculates the effective monthly rate of interest.
In the next cell the spreadsheet calculates the effective quarterly rate of interest.
In the next cell the spreadsheet calculates the effective half yearly rate of interest.
In the next cell the spreadsheet calculates the effective annual rate of interest.

Graph your results, displaying the log interest rate1 on the vertical axis and the nominal, then effective rates, on the horizontal axis (in the order given above).

Present your answers to the above questions in a spreadsheet, giving each solution on a separate sheet (labelled 'Part a', 'Part b', and 'Part c'). Your spreadsheet should be clearly labelled and easy to understand. Make sure you identify what the "inputs" and "outputs" are.

Reference no: EM131198000

Questions Cloud

Government interventions in the economy : Create an argument for or against the passage of such a law based on your conception of the ideas on the optimum size of government and on government interventions in the economy (Social Security is an intervention in the economy).

The various ways inflation can hinder economic activity : Discuss the various ways inflation can hinder economic activity. What are some strategies you might use in your life to deal with rising inflation? How might these strategies change if we experienced deflation?

Discuss the physical changes in boys and girls : Discuss the physical changes in boys and girls. Discuss how puberty affects emotional and social development in boys and girls.

Contributed to labor market rigidity in latin america : 1. What are some of the factors that have contributed to labor market rigidity in Latin America? Provide three explanations.

Develop an e?ective interest rate calculator. : ACST201 Financial Modelling. Next, develop an e?ective interest rate calculator. The calculator you develop should satisfy the following speci?cations.In the top cell the user enters the percentage nominal rate (like 7%)

Price measured in a common currency : If the price measured in a common currency) of a particular basket of goods is 13 percent higher in the U.S than it is in the United Kingdom, which country country's currency is overvalued, according to the theory of purchasing power parity? Explain.

Difference between monetary policy and fiscal policy : What is the difference between monetary policy and fiscal policy?

Think of an example of the principal-agent : Think of an example of the principal-agent that you experienced first-hand or read or heard about. What factors led to the problem? Were there serious adverse outcomes arising from the problem? Based on the course material, what suggestions can you o..

Identify the business problems of each of the given cases : Identify the business problems of each of the cases; describe the metaphor(s) used. Rank-order the critical issues stated in the cases Evaluate the proposed solutions. Are the solutions valid? Why or why not?

User Account

All Pages