ACC/BF HW11
NPV, IRR, XNPV, XIRR, YIELD; Matrices: MMULT, MINVERSE, Adding/Subtracting
Matrices, Multiplying a Matrix by a coefficient
Open ACC-BF-HW11-File.xlsx – save as username11.xlsx
In MORE BANKING, do the following; as you answer questions, you may insert data somewhere
on the sheet (such as in columns D:H); for all your answers on this sheet, show percentages and
decimals as percentages with 1 decimal; show currency as Euro with 2 decimals
1) I estimate that it will cost me 200000 EURO to open a new business. I expect to net the
following EURO during the first five years: 40000, 50000, 75000, 80000, and 100000. In B1:
What is my internal rate of return after 4 years? In B2: after 5 years?
2) I plan to invest 50000 EURO. I estimate that I will make the following amounts of EURO at the
end of the next five years: 5000, 10000, 15000, 20000, and 25000. Assuming a discount rate of
11%: In B4, what is its net present value after five years? HINT: Don’t forget the trick! Also, be
sure to show as EURO.
3) In B6, using the information in question 1 above, with the answer in B2, find the net present
value of the internal rate of return – then SAVE
4) I plan to invest 50000 EURO on June 1, 2015; I will get the following returns: 5000 on January
1, 2016; 10000 on April 1, 2016; 15000 on September 1, 2016; 20000 on March 1, 2017; and
25000 on May 31, 2017
a) In B8, at 10% discount rate, find the net present value
b) In B10, using the same currency values and dates, find the internal rate of return
c) In B12, using the same currency values and dates, find the net present value of the internal
rate of return – HINT: Your answer may be “close” to zero. Format it as a “Euro”, with 2
decimals
5) In B14: Find the yield for a security to be purchased on June 5, 2015 at 94.75 Euro at 7%
coupon value, with quarterly payments, that will mature on December 4, 2017, with normal
redemption
6) SAVE, and go to the next page
In MATRICES 1: Use MINVERSE and MMULT to solve for the
variables w, x, y, and z in the four equations (on the right).
As you work in Excel, do the following:
7) Make the inverse background green, with borders
w + x + y + z = 4
2w – x + y – 2z = 8
0.5w + 3x + 10y – 15z = -4
5w + z = 5
8) Use matrix multiplication to check that your coefficient
matrix times its inverse matrix gives the identity matrix – make the identity matrix yellow, with
borders
9) If necessary, change from “scientific notation” to “numbers” with no decimals
10) Show the answers for w, x, y, and z as bold
11) Use matrix multiplication to check your w, x, y, and z values; make the background of these
answers light blue, with borders
12) SAVE
In MATRICES 2:
13) Starting in A8, find Matrix A + Matrix B
14) Starting in E8, find Matrix B – Matrix A
15) Starting in I8, find 4*Matrix A – Matrix B
16) SAVE