CALCULATING FUTURE VALUES WITH EXCEL

Initial Deposit
100
Interest Rate
6%
Number of years, n
2
Account balance after n years

Future Value of $10

112.36

$350.00

0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

Future Value
$100.00
$106.00
$112.36
$119.10
$126.25
$133.82
$141.85
$150.36
$159.38
$168.95
$179.08
$189.83
$201.22
$213.29
$226.09
$239.66
$254.04
$269.28
$285.43
$302.56
$320.71

Future Value

$300.00

Year

$250.00
$200.00
$150.00
$100.00
$50.00
$0.00
1

ure Value of $100 at 6% Annual Interest

10 11 12 13 14 15 16 17 18 19 20 21

FUTURE VALUE OF A SINGLE DEPOSIT AT DIFFERENT

INTEREST RATES
HOW
$100 AT TIME 0 GROWS AT 0%, 6%, 12%
Initial Deposit
Interest Rate

100
0%

Year
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

100
6%

100
12%

FV at 0% FV at 6% FV at 12%
100
100.00
100.00
100
106.00
112.00
100
112.36
125.44
100
119.10
140.49
100
126.25
157.35
100
133.82
176.23
100
141.85
197.38
100
150.36
221.07
100
159.38
247.60
100
168.95
277.31
100
179.08
310.58
100
189.83
347.85
100
201.22
389.60
100
213.29
436.35
100
226.09
488.71
100
239.66
547.36
100
254.04
613.04
100
269.28
686.60
100
285.43
769.00
100
302.56
861.28
100
320.71
964.63

1200

1000

800

600

400

200

0
1

FV at 0%
FV at 6%
FV at 12%

10

11

12

13

14

15

16

17

18

19

20

21

FUTURE VALUE WITH ANNUAL DEPOSITS

the beginning of year
Interest
Year
1
2
3
4
5
6
7
8
9
10

at

6%
Account balance,
beginning of year
0
106.00
218.36
337.46
463.71
597.53
739.38
889.75
1049.13
1218.08
Future Value using
Excel's FV
functions

Deposit at
beginning of year
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00

$1,397.16

Interest earned
during year
6
12.36
19.10
26.25
33.82
41.85
50.36
59.38
68.95
79.08

Total in account
at end of year
$
$
$
$
$
$
$
$
$
$

106.00
218.36
337.46
463.71
597.53
739.38
889.75
1,049.13
1,218.08
1,397.16

FUTURE VALUE WITH ANNUAL DEPOSITS

at the end of year
Interest
Year
1
2
3
4
5
6
7
8
9
10

6%
Account balance,
end of year
0
100.00
206.00
318.36
437.46
563.71
697.53
839.38
989.75
1149.13
Future Value using
Excel's FV
functions

Deposit at end
of year
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00

$1,318.08

Interest earned
during year
0
6.00
12.36
19.10
26.25
33.82
41.85
50.36
59.38
68.95

Total in account
at end of year
$
$
$
$
$
$
$
$
$
$

100.00
206.00
318.36
437.46
563.71
697.53
839.38
989.75
1,149.13
1,318.08

THE PRESENT VALUE OF $100 IN 3 YEARS

in this example we vary the discount rate r
Future Payment (X)
Time of future payment (n)
interest rate(,r)

100
3
6%

Present Value (X/(1+r)n)

Discount rate
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
14%
15%
16%
17%
18%
19%
20%
21%
22%
23%
24%
25%
26%
27%
28%
29%
30%
31%
32%
33%
34%
35%

Present
Value
100.00
97.06
94.23
91.51
88.90
86.38
83.96
81.63
79.38
77.22
75.13
73.12
71.18
69.31
67.50
65.75
64.07
62.44
60.86
59.34
57.87
56.45
55.07
53.74
52.45
51.20
49.99
48.82
47.68
46.58
45.52
44.48
43.48
42.51
41.56
40.64

36%
37%
38%
39%
40%
41%
42%
43%
44%
45%
46%
47%
48%
49%
50%

39.75
38.89
38.05
37.24
36.44
35.67
34.92
34.20
33.49
32.80
32.13
31.48
30.85
30.23
29.63

Line versus XY Charts

x
0
6
8
15
22
97

y
13
22
31
-8
14
6
35
30
25
20
15
10
5
0
-5 0
-10

60 12

18 6 24

yx

24

30

36
8

42

4815 54

60 22
66

72

7897 84

90

96

AVERAGE MONTHLY MAXIMUM AND MINIMUM TEMPERATURES--NEW YORK C

Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Avg max
temp (F)
Avg min
temp (F)

38

40

50

61

72

80

85

84

76

25

27

35

44

54

63

68

67

60

NYC Temprature
90
80
70
60
50
40
30
20
10
0
Jan

Feb

Mar

Apr

May

Jun

Jul

Months

Aug

Sep

ES--NEW YORK CITY

Oct
Nov

Dec

65

54

43

50

41

31

mprature

Avg max temp (F)

Avg min temp (F)

Sep

Oct

Nov

Dec

GRAPHS TITLES THAT UPDATE AUTOMATICALLY

Growth

15%

Year
1
2
3
4
5
6
7

Cash Flow Graph When

Cash flow
100
115.00
132.25
152.09
174.90
201.14
231.31

250
200
150
100
50
0
1

Cash Flow Graph When

Growth = 15.0%

h Flow Graph When

= 15.0%

Growth

3,000
4,000

2,500
2,000

Dividends

MERCK & CO. 1991-2000

Proceeds
Purchase
from
of
Year
Dividends
exercise
Treasury
of stock
stock
options
1991
893
184
48
1992
1,064
863
52
1993
1,174
371
83
1994
1,434
705
139
1995
1,540
1,571
264
1996
1,729
2,493
442
1997
2,040
2,573
413
1998
2,253
3,626
490
1999
2,590
3,582
323
2000
2,798
3,545
641

3,500

3,000

1,500
1,000
500

2,500

0
1991

1992

2,000

1,500

1,000

500

0
1991

1992

Merck Dividends, 1991-2000

Merck Treasury Stock and Option Exercise

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

Year

1993

1994

1995

1996

Years

1997

1998

1999

2000

Exercise

2001

Purchase of Treasury stock

Proceeds from exercise of stock options

2001