Assuming the original assumptions, how much in interest will the organization pay over 3 years?

You work for We Build the World Manufacturing Inc. The company has decided to get a three year loan to purchase a high end lathe for $1M. The current interest rate is 6%. Your job is to calculate the monthly interest payments by building a loan amortization table.

The model should have three areas:

  1. Documentation: Explaining the purpose of the model
  2. Input; There are three inputs required for this model, annual interest rate, number of months of the loan, and the loan amount
  3. Formula/Output Area: As shown on the example for a $500 loan for twelve months, the inputs are feeding the calculations in the Formula/Output Area.

Answer the following questions:

  • Assuming the original assumptions, how much in interest will the organization pay over 3 years?
  • If the interest rate drops to 3%, what impact does that have on interest payments?

 

Based upon the following story
complete the model criteria in Microsoft Excel
:
The model
should contain the following sections: Description, Inputs, and Formula/Outputs.
You work for We Build the World Manufacturing Inc. The company has decided to get a three
year loan to purchase a high end lathe for $1M. The current interest rate is 6%. Your job is to
calculate the monthly interest payments by
building a loan amortizati
on table.
Criteria Complete Using Microsoft Excel
Weight
1.Assuming the original
assumptions, how much in interest
will the organization pay over 3
years? 30%
2. If the interest rate drops to 3%,
what impact does that have on
interest
payments?30%
The final model should contain the
following sections: Description, Inputs,
Formula/Outputs.20%
Total Quality (grammar, spelling, and APA
formatting) 20%
Total 100%
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