RENTALS

FINANCIAL

UNIT 3
What do all these examples have in common?
EXAMPLES:
● Monthly pension Lanóminao that every month
charge a person
Definition of arent
Lahipotecaque we have every month financial:
what to return
set of capitals
A rental every month.
that are distributed to
tenant pays us a monthly fee length of time

An investment fund in which I participate

periodic contributions until accumulating a
capital
 What will we do with the
rents?

We will be interested in comparing them,

to that end we will calculate:

its current value (VA)

its final value (VF).

We will use thelaw of

compound capitalization or
of compound discount.
 VARIABLES THAT INTERVENE IN THE
CALCULATION OF INCOME
Theduration of the rent(n): Theinterest rate(i): Theterm(a)corresponds
that will match the number we will always work with types with each of the capitals that
of capitals of this. The effective interest, whether they make up the rent.
time and interest rate annual or fractional
they will always refer to the They are also commonly referred to as
Banking entities can payments and collections.
same unit of time.
work with TIN. They are theoretical and
we can use them. The frequency of payment of
the term will mark what
We must transform them into units will express time and
so many effective the interest rate.
REMINDER:
1. To calculate the effective annual interest rate from a fractional interest rate:

2. To calculate the effective fractional interest rate from an annual interest rate:

3. To convert a nominal interest rate (TIN) into an effective fractional interest rate:
FINANCIAL VALUE OF A RENT

The financial value of a rent is the result of bringing

all the capitals at a moment in time
determined.
TheCurrent value of the rentit is calculated by updating all its
capitals (taking all their capitals to moment 0), for
calculate its financial value at time zero.
TheFinal value of a rentit is calculated by capitalizing all
its capitals (bringing all its capitals to the moment),
to establish its financial value at the moment.
PRACTICAL CASE 1
Calculation of the Final Value of a rent using the capitalization factor
composed

The company ADMIN, S. L., has an empty property apartment, where

formerly there were the offices, and it is available for rent for 5 years,
charging an amount of 5,000€ to be paid by the tenant or lessee
at the beginning of each year.

How could we calculate the total amount that ADMIN, S. L., will have charged?
of rent at the end of the 5-year contract, if we work with a type of
effective interest of 3% per year?
SOLUTION: PRACTICAL CASE 1
The payment of rent is always made at the beginning of each period.

Therefore, you place the initial capital at time 0 on the graph (if the rent were to be paid at the end, the first
you would have placed the capital at point 1 on the graph and not at point 0).
SOLUTION: PRACTICAL CASE 1
To calculate the Final Value of the rent (that is, the sum of the Final Value of each one of the
n
capital of income), you will use the compound capitalization factor:(1+i)

Vn= 5 000 * (1+i)5+ This amount would be the value

5 000 * (1+i)4+ of the rental operation
at the end of the 5 years,
5,000 * (1+i)3+ taking into account that
5,000 * (1+i)2+ you work with a 3% annual rate
5000 * (1+i)1= of interest.

27 342,04 €
ACTIVITIES
Indicate in the example of the company CALIN, S. L.:
What are the capitals that form the income and their amount.
When does each capital mature?
The duration of the rent.
Graphical representation

a) The capitals that form the income are the fees of the leasing.
423,46 €.
b) Every month.
They are 48 months.
ACTIVITIES
Identify the variables involved in the following incomes:
The company we work for is requesting a loan to purchase
machinery. To amortize it, you will have to pay monthly installments of €300
during the next 2 years. The effective annual interest rate is 10%.

We hired the services of a tax and labor consultancy during the

next year. We will pay monthly installments at the end of the month of 50€. The type
The effective annual interest rate is 3.0%.
 SOLUCIÓN :ACTIVIDADES
Identify the variables that intervene in the following incomes:

1) Término (a)= 300 €,

Duration (n) 24 months,
Annual effective interest (i) 10%.

2)Término (a)= 50 €,
Duration (n) 12 months,
Annual effective interest (i) 3 %.
CLASSIFICATION OF THE
RENTALS
 CONSTANT INCOMES :

ALL CAPITALS HAVE THE

SAME AMOUNT.

ACCORDING TO THE

NATURE OF
VARIABLE RENTS:
THE CAPITALS
THE CAPITALS ARE DIFFERENT
 ANNUAL RENT :
A year passes between capital and capital

ACCORDING TO THE
Fractional Rents:
Periodicity Between capital and capital passes LESS
of a year
DEL
RENTALS WITH
EXPIRATION SUPERIOR PERIODICITY
TO THE YEAR:
Between capital and capital more than passes
one year
 PREPAID RENT :

THE TERMS EXPIRE AT THE BEGINNING

FROM EACH PERIOD
ACCORDING TO THE

EXPIRATION
FROM THE Postpaid Rents:
TERM THE TERMS EXPIRE AT THE END OF
EACH PERIOD
 IMMEDIATE RENTS :

The first rental period begins on the

stage in which the operation is agreed.

ACCORDING TO THE
ADVANCED RENTS:
BEGINNING AND THE They are those that have their valuation point higher.
beyond the end of the rent.

FINAL OF THE
DEFERRED INCOMES:
RENT
The first payment is made after several
periods since the operation begins.
 TEMPORARY RENTALS
:

THEY HAVE A FINITE NUMBER OF

CAPITALS

ACCORDING TO THE

DURATION PERPETUAL RENTS:

THEY HAVE AN INFINITE NUMBER OF
CAPITALS
 ACCORDING TO THE ACCORDING TO THE ACCORDING TO THE ACCORDING TO THE

NATURE PERIODICITY EXPIRATION BEGINNING AND ACCORDING TO THE

OF THE OF THE OF THE THE END OF THE DURACIÓN

CAPITALS EXPIRATIONS TERMS RENT

CONSTANTS ANNUAL PREPAYABLE IMMEDIATE TEMPORAL

VARIABLES PAYABLE IN INSTALLMENTS ANTICIPATED PERPETUAS

Periodicity
SUPERIOR TO DEFERRED
YEAR
 PRACTICAL CASE 2
The company ADFI, S. L., contracts with a banking entity a plan of
savings, to which he contributes 1,000€ at the end of this year, at the end of the second
year, 1,000€, and so on for the next 5 years.

Graphically represent the operation and classify the income.

The rent isconstant(the amount of capital is always the same, 1,000€)

annual(contributions to the savings plan are made every year)

postponable(the first contribution is made at the end of each year)

immediate(the first rental period starts in the first year)

temporal(the number of capitals in the operation amounts to 5).

ACTIVITIES
Classify the following incomes:
A retirement pension of 1,000€ per month that we will receive.
at the end of each month starting at 65 years old, assuming that we
we just retired.
We bought a car in January. We made the first payment in June.
The payments are €300 per month (paid at the end of the month) for 6
years.
3) We apply for unemployment benefits and we are recognized for the payment of
the benefit for 18 months. For the first 6 months, we will receive a
gross amount of 560€ and the remaining months 480€.
ACTIVITIES
Classify the following incomes:
1) A retirement pension of 1,000€ per month, which we will receive at
at the end of each month starting at 65 years old, assuming that we
we just retired.

Constant, fractional, postpayable, immediate and

perpetual.
ACTIVITIES
Classify the following rents:
We bought a car in January. We made the first payment in June.
The payments are €300 monthly (paid at the end of the month) for 6 months.
years.
Constant, fractional, payable in arrears, deferred, and temporary.
ACTIVITIES
Classify the following incomes:
A retirement pension of €1,000 monthly, which we will receive at
We request unemployment benefits and we are recognized for the payment of
the benefit for 18 months. For the first 6 months, we will receive a
gross income of 560€ and the remaining months 480€.

Variable, fractional, post-payable, immediate, and temporary.

 PRACTICAL CASE 3
Santiago and Elena are saving to buy a SUV in five years.

If the car costs €40,000 and they can get a 5% APR on their savings.

What constant amount should they save each year for the next five years?

C5= 40,000

TAE= 5%
X= 7,328.99
X+ X(1+0.05)1+ X(1+0.05)2+ X(1+0.05)3+ X(1+0.05)4=40.000

X * 5.5125 = 40000
CONSTANT RENTS TO A
COMPOUND INTEREST
CONSTANT INCOMES

In thepostpaid rents,the first term expires at the end of the first period.

In theprepaid rents,the first term expires at the beginning of the first

periodo.
 RENT
CONSTANT
IMMEDIATE AND
POSTPONABLE
Final value of a rent

To calculate the value

end of a rent
we will move the
capitals of each year
final moment.
The image shows a
annual rent of €1,000,
which we will call (c) during
four years, of which
we want to know its value
final. The interest rate is the
10%. The rent is paid at
end of each period.
FINAL VALUE
FROM A RENTAL:
CONSTANT
IMMEDIATE AND
POSPAGABLE

Let's remember the formula of the

compound capitalization. We can
apply it several times to obtain the
final value of a rent:

n
C = C ( 1 + i )
n O
 ○ The €1,000 from year 4 do not need to be capitalized.
because it is already at its value. Its final value is
1,000€
○ To capitalize the €1,000 from year 3 to year 4
they are simply multiplied by (1+i). Their value
final is 1,100€
○ To capitalize the €1,000 from year 2 to year 4, you
they multiply by (1+i)2Its final value is €1,210
○ To capitalize the €1,000 from year 1 to year 4, it
multiply by (1+i)3Its final value is €1,331.

So, adding everything up, in year 4 we will have €4,641.

It is the Final Value of a rent.

Sometimes it is called Vn, other times Sn¬i. It is also

frequently use the expression VF, used by the function
from the Excel spreadsheet.

Instead of capitalizing all the terms of the income, if the

the amount is always the same, we can try
develop a formula for rents. Let's
assuming that the capital is 1€; this is what is called a
unit rent. It is the sum of n terms in
increasing geometric progression with a ratio of 1 + i
Instead of capitalizing all the
rental terms, if the
the amount is always the same,
we can try to develop
a formula for rents.

Let's suppose that the capital

it is 1€; it is what is called
a unit rent.

It is about a sum in
terms in progression
increasing geometric ratio
1+i
 THE FORMULA OF RENTS

Now we are going to write the terms one below the other and sum them up.
But taking into account two things:
● A property that each term has is that it is equal to the previous one multiplied by (1+i).
● On the right side, we factor out (1+i).
FINAL VALUE OF A RENT

CONSTANT

IMMEDIATE

POSPAGABLE
Exercise SnI

Calculate how much you will have saved after 20

years, if you deposit in an account at 3% APR
€2000 annually, always at the end of the year.
Exercise Sni

Calculate how much you will have saved afterward. 20 years old , if
deposit 2000€ annually in an account at 3% TAE always
a final of the year.
Exercise Sn I

Calculate the final value of a postponable and immediate temporary annuity of

constant amount of 500€ if its duration is 10 periods and is
evaluate at a compound interest rate of 6%.
VALUE
INITIAL OF
A RENT
CONSTANT
IMMEDIATE AND
POSTPONABLE
CURRENT VALUE OF A RENTAL

CONSTANT

IMMEDIATE

POSTPONABLE
FORMULAS FOR CONSTANT, IMMEDIATE, AND POSTPONED RENTS

( 1 + i ) n1
VF =ax VF = VO( 1 + i )n
i
PRACTICAL CASE 3
Calculation of the Present Value of a constant, immediate annuity
postponable

Calculate the Present Value of an immediate constant annuity.

postponable for six terms, valued at an annual interest rate
of 10%.

The amount of your terms amounts to €100 each.

SOLUTION: PRACTICAL CASE 3
n = 6 years.
First, you will identify the variables involved in the calculation of income:
i = 10% annual.

a = 100 €.
PRACTICAL CASE 4
Calculation of the Final Value of a constant, immediate annuity
postponable

Calculate the Final Value of a constant, immediate annuity.

deferred payment of six terms, valued at an interest rate
annual of 10%.

The amount of your terms amounts to 100 € each.

SOLUTION: PRACTICAL CASE 4
First, you will identify the variables involved in the calculation of income:

n = 6 years.

i = 10% annual.

a = 100 €.

Vn = ?
SOLUTION: PRACTICAL CASE 4
First, you will identify the variables involved in the calculation of income:

Another way to calculate the Final Value of the rent from the Present Value you calculated in the practical case.
previously is based on capitalizing the Present Value of the rent, that is, if you take it to the final moment of the rent (to the
At step 6), you will obtain the same result as using the previous formula. Let's check it:

Vn = Vo · (1 + i)
n

6
Vn = 435.53 · (1 + 0.1)

You will multiply the Present Value by the capitalization factor raised to 6, since from moment 0
There are six periods until the end of the rent.

Vn= 771,56€
EXERCISE 1
CALCULATE THE PRESENT VALUE OF A SINGLE RENTAL
PAYABLE IN 10 PERIODS IF VALUED AT A RATE
INTEREST OF 8%.

ALSO MAKE THE GRAPHICAL REPRESENTATION.

SOLUTION: EXERCISE 1
EXERCISE 2
Calculate the present value of a three-term annuity
annual amounts due of 100 euros each at a rate of
10% annual effective interest.

ALSO PERFORM THE GRAPHICAL REPRESENTATION.

SOLUTION: EXERCISE 2
EXERCISE 3
Calculate the final value of a three-term annuity
annual dues of 100 euros each at a rate of
10% effective annual interest.
SOLUTION EXERCISE 3
EXERCISE 4

Calculate the accumulated amount in a bank after 5 years,

if we impose at the end of each of them 20,000 euros being
the interest rate of the account is 12% effective annual.
The accumulated amount after 5 years will be the final value of
the income formed by the deposits that have been made,
using the interest rate as the valuation benchmark
own account.
SOLUCIÓN: EJERCICIO 4
CALCULATION OF: -NUMBER OF TERMS OF A RENT
AMOUNT OF THE TERM OF A RENT

CONSTANT WE WILL USE THE

FORMULAS OF
FINAL VALUE AND
INITIAL VALUE AND
WE WILL SUBSTITUTE
IMMEDIATE WITH THE DATA
LET'S HAVE
IN ORDER TO
CLEAR THE
UNKNOWN.
POSTPONABLE
EXERCISE 5
Calculation of time in a rental

Calculate the number of income of 25,000 euros that we have

what to do at the end of each year to gather 209,845.94 euros in
a bank that capitalizes at 6% annual effective.
SOLUTION: EXERCISE 5
PRACTICAL CASE 5
Juan Pérez, a farmer, needed to renew his tractor. Since he didn't
he wanted to go into debt, he signed up for a savings plan for self-employed people

that his bank offered him, at an effective interest rate of 3% per year.
I imposed a savings plan of €2,000 at the end of each year.
managed to save a total of €8367.26.

How many years were you saving to get that?

quantity?
 SOLUTION: PRACTICAL CASE 5

First, you will identify the variables involved in the calculation of income:

i = 3% annual. a = 2,000 €.

Vn = 8,367.26 €. n = ? years.
PRACTICAL CASE 6
Calculation of the value of the term in an annuity

A businessman owes a supplier €3,000. What

amount to be paid to the supplier annually (at the end
of each year) to settle the debt during the
next 4 years, if the effective annual interest rate is
10 %?
 SOLUTION: PRACTICAL CASE 6
First, you will identify the variables.
that intervene in the calculation of the
rent:

Vo = 3 000 €.

n = 4 years.

i = 10 %.

a=?
 RENT
CONSTANT
IMMEDIATE AND
PREPAYABLE
 CONSTANT, IMMEDIATE, PREPAYABLE RENT
These types of rents have constant terms, which are paid to the
beginning of each period.

Since they are immediate, the beginning and the end of the operation coincide with the
expiration of the first and the last term.

The only difference between the

formula for the Present Value of a
prepaid rent and a rent
deferred is the factor(1+i)
PRACTICAL CASE 7
Calculation of the Final Value of a constant, prepayable annuity
immediate

The company ADMIN, S. L., has a vacant property, where

formerly their offices were there, and they are looking to rent it for 5
years, charging for said rent an amount of €5,000, which the tenant
the tenant will pay at the beginning of each year. Calculate the amount that the
how much will the company have charged in rent at the end of the 5-year contract if
we work with an effective interest rate of 3% per year.
SOLUTION: PRACTICAL CASE 7
a = 5,000 €. i = 3 % annual.

n = 5 years. Vn = ?

Type of income: constant, immediate, and prepayable.

EXERCISE 6
Calculate the present and final value:
A rent of three annual terms situated
at the beginning of the year 100 euros each
at an effective interest rate of 10%
annual.
SOLUTION: EXERCISE 6
SOLUCIÓN: EJERCICIO 6
 PRACTICAL CASE 7
Calculation of the Final Value of a constant, prepayable annuity
immediate

The company ADMIN, S. L., has an empty property where

formerly their offices were located there, and it is available for rent for 5
years, charging for such rental an amount of 5,000 €, which the tenant or
the tenant will pay at the beginning of each year. Calculate the amount that the
the company will have charged in rent at the end of the 5-year contract if
We work with an effective interest rate of 3% per year.
 SOLUTION: PRACTICAL CASE 7
a = 5,000 €. i = 3% annual.

n = 5 years. Vn = ?

Type of rent: constant, immediate and prepayable. The payment of the first rent installment is made during the
first year, but, instead of being paid at the end of the first year (moment 1), it is paid at the beginning of the first year
(moment 0), when the operation is contracted.

If you look at the graph, you will see that at moment or point 5 there is no payment. Why? Because the payment of
the last period takes place at the beginning of this one (that is, at moment 4).
 SOLUTION: PRACTICAL CASE 7
First, you will obtain the Present Value of the payable rent:

Below is the Final Value of the rent:

Vn = Vo • (1 + i)^n

Vn = 23585.49 • (1 + 0.03)5

Vn= 27 342,04€
EXERCISE 7
EXERCISE 8
EXERCISE 10
EXERCISE 11
 RENT
CONSTANT Y
DEFERRED
CONSTANT AND DEFERRED RENT
The main feature of this income:

The first term of the rent is due after the start of the operation.
it does not expire in the first period of the operation, but it does so with
priority.
 VALUE
ACTUAL FINAL VALUE
CONSTANT RENT
FIXED RENT DEFERRED
DEFERRED PAYABLE
POSTPONABLE

VO Vn

n = total of the operation

n = number of periods of the income
EXERCISE 1: CONSTANT AND DEFERRED INCOME
Calculate the present and final value of an annuity with a duration of 5 years, with
annual prepayable terms of 2,700 euros knowing that they start to
to yield in 3 years. At a valuation of 11% annual effective.

This is a deferred rent for 3 years, with prepayable terms and 5 terms.
SOLUTION EXERCISE 1: CONSTANT AND DEFERRED INCOME
 PRACTICAL CASE 8
Calculation of the Present Value of a constant and deferred annuity

A self-employed person decides to acquire machinery for their business.

The supplier offers you the option to finance this acquisition with the
following conditions: will make four annual payments of 1,500 €, but the first
payment will be made three years after the start of the operation. The interest rate
The annual effective rate is 10%.

Calculate:

The cash value of the machine.

The Final Value of the operation.
 SOLUTION: PRACTICAL CASE 8
n = 4 terms (the first payment is made at moment 3).
va = 1,500 €.
i = 10 %.

Vo = ?
Vn = ?
 VALUE
CURRENT FINAL VALUE
CONSTANT RENT
CONSTANT RENT DEFERRED,
DEFERRED PREPAYABLE
PREPAYABLE

VO Vn

n = number of periods of the

n = number of rental periods operation
 PRACTICAL CASE 9
Calculation of the Final Value of a constant and deferred annuity

A freelancer decides to acquire a machine for his company. The supplier offers him the
possibility of financing said acquisition under the following conditions: it will carry out
four annual payments of €1,500, prepayable and the first payment will be made at the beginning
of the third year.

The effective annual interest rate is 10%.

Calculate:

The cash value of the machine.

The Final Value of the operation.
SOLUTION: PRACTICAL CASE 9
n = 4 terms (the first is paid at the beginning of the third year).
i = 10 %. a = 1,500 €.
Vo = ? Vn = ?
 RENT
CONSTANT Y
ANTICIPATED
CONSTANT AND ADVANCED RENT
In this, the operation concludes or is assessed after the last one expires.
end of the rental.
The calculation ofCurrent value is calculated in the same way as in an immediate annuity (the periods of
anticipation does not affect the calculation of Present Value.
The Final Value, you must consider the periods of anticipation.
 VALUE
ACTUAL FINAL VALUE
CONSTANT RENT
FIXED INCOME ANTICIPATED
ANTICIPATED,

VO Vn
 PRACTICAL CASE 10
Calculation of the Final Value of a constant and advanced annuity

A self-employed person has been contributing to a savings plan of 2,000 €.

annual for 5 years. At 7 years of the operation, withdraw the
money contributed, with the aim of acquiring a commercial vehicle.

Calculate the money that will be available in 7 years to face the

vehicle payment if the transaction is valued at 3% annual effective.
SOLUTION: PRACTICAL CASE 10
 RENT
PERPETUAL
PERPETUAL RENT
The main feature of this income:

A perpetuity is one that has infinite terms and, therefore, does not
it has an end.
It makes no sense to calculate its Final Value, but we will be able to calculate its Value.
Actual
PERPETUAL RENTS

Postpaid rental:

Prepaid rent: From a perpetual rent =

PERPETUAL RENT: PREFERRED EXAMPLE
What are preferred shares?
They are a hybrid asset between stocks and bonds.
● They are fixed income: the investor receives a fixed percentage of interest as payment (but, if the bank or
the savings box issuers have no benefits, they will not pay interest).
Its maturity is indefinite (perpetual), so it cannot be considered a payable debt.
But they cannot be considered shares either, because their sale is not completely free, as
requires the consent of the issuing entity.
In the event of a competition (bankruptcy) of the issuing bank or savings bank, at the time of collection,
investors are ranked in order of preference behind all creditors and in front
of the ordinary shares. That is to say, preferred investors are the least preferred of
everyone at the time of collecting.
They are complex products whose understanding requires technical knowledge.
 PRACTICAL CASE 11
Calculation of the Present Value of a constant annuity and
perpetual
Calculate the Present Value of a perpetual rent whose term
rises to €100 annually if the operation is valued at 4%
annual effective.
SOLUTION: PRACTICAL CASE 11

The Present Value of the perpetual rent will be:

CONSTANT INCOMES A
fractionated
With fractional rents: the terms, instead of having an annual maturity, may have maturities.
monthly, daily, quarterly, four-monthly, etc.

When working with fractional rents, you should observe the following steps:

1. Identify the frequency of the terms: monthly, quarterly, semiannual...

2. Based on the frequency of the terms, you will calculate the corresponding interest rate. That is, if
the terms are monthly, you will calculate the equivalent effective monthly interest rate.

3. Finally, the time will also depend on the frequency of the terms.
REMINDER:
1. To calculate the effective annual interest rate from a fractional interest rate:

2. To calculate the effective fractional interest rate from an annual interest rate:

3. To convert a nominal interest rate (TIN) into a fractional effective interest rate:
PRACTICAL CASE 12
Calculation of the Present Value of a fractional annuity

The company ADMIN, S.L., requests a loan to be able to meet

debts with suppliers.

To cancel the loan, you must make monthly payments of 200€.

during the next 2 years.

Knowing that the effective annual rate of the operation is 11.1% per year,
calculate the amount of money that the bank has lent you.
SOLUTION: PRACTICAL CASE 12
a = 200€ (monthly payments).

i = 11% (you need to calculate the equivalent monthly interest).

n = 2 years = 24 months.
PRACTICAL CASE 13
A company needs to acquire new machinery for the production process. It contacts two
different suppliers, who offer you the following conditions:

1. Pay for the machinery €2,000 at the time of purchase, and €2,100 after one year.

Pay €1,000 at the time of purchase and the rest in 6 monthly payments of €500.
each one (the first payment will be made at the end of the third month).

Which option is more advantageous for the company? The nominal interest rate is 12%.
capitalizable monthly.
 SOLUTION: PRACTICAL CASE 13
OPTION 1: The provided interest rate is a nominal interest rate. You must find the effective interest rate.
(which is what you will need for the formulas).
Current value of the initial capital = 2,000 €

Current value of the second capital = 2100 · (1+i)−n

To calculate the Present Value of the second capital, you have two options:

1. Calcular el efectivo anual e indicar el tiempo en años (1 año).

2. Work with the monthly cash and convert the time to months (12
months). In this practical case, you will work with the monthly cash.
Current value of the second capital = 2100⋅(1+0.01)−12 = 1,863.64€

2 000 + 1 863,64 =3 863,64 €

If the company buys the machine from the first supplier, the purchase price
from this will be 3,863.64 €.
 SOLUTION: PRACTICAL CASE 13
OPTION 2: The provided interest rate is a nominal interest rate. You must find the effective interest rate.
(which is what you will need for the formulas).
ACTIVITIES:
[Link] the Present Value of a rental of 5,000€ annually
from an agricultural farm.

Annual effective interest: 10%.

SOLUTION ACTIVITIES:
4.
1
Vo=5000x (1+0.10)×
0.10

V0=55,000 €
ACTIVITIES:
[Link] the value it would have today a
machinery for which we will pay three
deferred annuities of 1,700€,
its valuation is 11% per year.
SOLUTION ACTIVITIES:
5.
ACTIVITIES:
6.A company hires a construction company to carry out the
rehabilitation of a building owned by you. To do
In front of the payment, request a loan from a banking institution.
with the following conditions: 7% annual effective interest
with annual payments of 6,000€ and a duration of 4 years. Calculate
the amount of the work that will be paid to the construction company.
SOLUCIÓN ACTIVIDADES:
6.
0.07

----
ACTIVIDADES:
7.A financial advisor receives an inquiry from a client.
specifically, who is interested in hiring a plan of
savings, so that when they retire they have some
savings capital to complement your pension. Calculate
how much will he have saved after 20 years (time at which
which will retire), if it makes annual payments of 30,000€ at the end
of each year. The effective annual interest of the operation is
3 %.
SOLUTION ACTIVITIES:
7.

VO
x
ACTIVIDADES:
[Link] the Present Value of the following immediate annuities
and payable:

300€ monthly for 2 years, at 4% effective

semester.
500€ quarterly for 4 years, at a 12% nominal rate
capitalizable by quadrimesters.
SOLUTION ACTIVITIES:
8.
ACTIVIDADES:
[Link] the purchase price of a computer if we decide to defer.
el pago.

We will settle the debt by making six monthly payments

payable of 210€.

The TIN is 18% capitalizable monthly.

SOLUTION ACTIVITIES:
9.
ACTIVIDADES:
10.A banking entity granted a loan of 22,000€.
which will be amortized through 18 constant monthly payments,
overcoming the first payment at 6 months of the concession of
loan.

Find out the amount of that monthly payment, if the operation is

valued at the TIN 9.0% capitalizable monthly.
SOLUTION ACTIVITIES:
10.
ACTIVIDADES:
[Link] individual is interested in creating a savings plan.
to change your car in 5 years. For this, hire
a Santander SIALP savings plan. Calculate what amount
will have saved at the end of 5 years, if making contributions
100€ monthly and the annual interest rate is 0.25%.
SOLUTION ACTIVITIES:
11.
ACTIVIDADES:
12.A company has acquired a business in operation
as an investment. Calculate the Present Value of that investment
during the next 5 years if the business generates some
monthly net income of €2,800 and expenses amount to
€1,225 per month. The effective monthly interest rate is
0.75%
SOLUTION ACTIVITIES:
12.
ACTIVIDADES:
13.

A self-employed person wants to acquire a vehicle for the company. It

will be financed for 5 years with monthly payments. If the car is
valued at €13,000
How much will the monthly payments rise if the interest rate
The annual effective interest rate is 12%?
ACTIVIDADES:
14.

Calculate the amount that a company owes to a

supplier for the purchase of raw materials if for
to cancel the debt, it must pay 500€ in cash and three
overdue monthly payments of 300€ each.
operation is valued at 1% effective monthly.
SOLUTION ACTIVITIES:
14.
ACTIVITIES:
15.

A company wants to paint and renovate the furniture of the

offices. To do this, make deposits of 300€ per month
in a banking entity for 2 years. If the operation is
valued at 10% annual nominal interest rate capitalized monthly, calculate the
capital that will have been constituted at the end of the 2 years.
SOLUTION ACTIVITIES:
15.
REVIEW ACTIVITIES
1. Find out the value of a property today, if it produces about
semiannual payments payable in perpetuity of €2,800.
The operation is valued at 5% effective annual.
2. Calculate the Present Value of a monthly rent of 280 €, payable for 5 years.
years, if the valuation rate is 10% per year and the income is:
a) Immediately payable.
b) Immediately prepayable.
c) Deferred for 3 years and payable later.
d) Deferred for 3 years and prepayable.
3. A self-employed person deposited €12,000 in a bank 7 years ago at 5% annual interest.
Today, with the amount obtained, perform the following operations:
Pay a debt amounting to 5% of the total.
Pay in cash for a car, which costs 36 overdue monthly payments of 350 €.
The rest is deposited in the company's cash register to meet current liabilities.
Calculate:
a) The amount of the final principal or capital.
b) The amount of the debt.
c) The amount you deposit in the company's cash register.
A certain company has requested a loan for 4 years, and has
made constant monthly payments of €200. If the percentage
applied is 0.75% effective monthly, calculate the Final Value
of the loan if we value it at 5 years after its granting.
5. A businesswoman is considering expanding her company. To
Hello, I should apply for a loan of 20,000 € at 10% annual.
15 years. The first payment will be made 12 months after contracting.
the operation, and the payments will be quarterly and prepaid.
Calculate the amount of loan payments.
6. A self-employed person who owns a rented property charges a rent of
900 € monthly at the beginning of each month. Community expenses
They are also paid at the beginning of each month and amount to €30.
monthly. Calculate the present value of the net income that you
provides this investment, if we consider that the income that it
The rental is perpetual. Effective annual interest: 8%.
7. La propietaria de una tienda adquiere un nuevo equipo de aire
conditioned, the amount of which amounts to €2,500, and proceeds to
pay it with the credit card. Through the online service of
bank, requests a deferral of the payment and, for that reason, the bank
will begin to charge a monthly amount to your checking account and
fixed for the next 6 months. If the effective interest rate of the
the operation is 15% annual, calculate the amount of the payments
monthly payments that will be required to settle your debt.
8. The company Win, S.L., is engaged in the production of juices and needs to renew.
a vertical tank with a capacity of 10,000 liters. The supplier of the tank
offers the following financing conditions: pay €5,000 in cash and the
payment in 12 monthly installments (at the beginning of each month) of 600 € each,
starting the first payment 3 months after the purchase. Calculate the price of
purchase. Effective annual interest: 9 %.
9. The company CHAVELI, S. L., is made up of three partners who are siblings. Their father has passed away.
recently and would like to invest an amount equivalent to 25% of the inheritance in the company, since it
finds itself in the midst of expansion. The assets that the siblings have inherited are the following:
An orange farm, which reports approximately annual net profits of €100,000.
b) A property owned by them that is rented out and for which they receive a net monthly rent of €1,800.
The rental contract has a duration of 5 years.
c) 300,000 € in cash.
What is the current value of the inheritance? What amount can they allocate to the expansion of the business?
valuation: 6% annual effective.
10. An entrepreneur has been making monthly deposits of 500 €.
at the end of each month and for 5 years, in a savings account, with the aim of
raise capital and open a business. At the age of 7, he decides to invest the amount
accumulated in the creation of a new company. How much money will be available?
to carry out your project? Annual effective interest: 7%.
A private individual approaches a financial institution, since he is
interested in hiring a pension plan, so that in 25
In years, I can rescue 40,000 €. What amount should be deposited in the end?
of each year in the pension plan, if the manager of the plan gives you
it promises an average return of 3% per year?
12. A company has made deposits of €2,000 semi-annually for 6
years at the beginning of each year, with the aim of gathering capital that allows him to
renew an immobilized asset. After 8 years of starting the investments,
They decide to purchase the fixed assets. What amount do they have available to make the purchase?
investment? Interest: 1% effective monthly.
13. A company has just acquired three electric pallet trucks. The
the provider offers you the possibility to make 10 payments at the beginning of each
semester, taking into account that the first one will take place 3 years after the
purchase and which will have an amount of €580. Calculate the cash value of the three.
pallet trucks. Effective annual interest: 11%.
14. The owner of a company is presented with two options:
Option 1: buy 3 vending machines, paying €250 at the end
every month, for two years.
b) Option 2: rent the machines perpetually, paying a fee.
monthly of 64 € at the beginning of each month.
If the operation is valued at an effective annual rate of 12.682503%, what option is the most suitable for you?
more interesting?
15. A businesswoman acquires a packaging machine that she will pay for as follows
form:
a) He/She will pay €4,000 at the time of purchase.
b) It will pay €2,000 annually in arrears for 4 years.
c) At the end of the fourth year, it will also make a payment of 1,500 €.
Calculate the purchase value of the machine if the effective annual interest is 10%.
16. A company needs to acquire a transportation vehicle. The supplier offers it to them
offers the following payment conditions:
a) Pay 5,000 € in cash.
b) Pay 18 prepayable monthly installments of 500 € each (the first one
payable 6 months after the purchase.
c) Two years after the purchase, you will pay €4,000. Calculate the acquisition value of the
vehicle if the APR is 12% capitalizable monthly.
A client of our financial institution has requested a loan of 50,000.
€ for 10 years, making constant, monthly, and postpaid payments. If the percentage
the nominal rate applied, capitalizable monthly, is 1.98%, calculate the amount
of the monthly payments.
An entrepreneur is considering opening a new business that will generate him the
following expenses and income:
The amount of the projected monthly income amounts to €16,000 at the end of each month.
b) The salaries that must be paid at the end of each month amount to €3,000 per month.
c) The rent of the premises amounts to 2,000 € per month (to be paid at the beginning of each month.
months).
d) The remaining expenses would amount to approximately €1,500 at the end of each month.
Calculate the present value of the benefits that the business will generate during the
next 12 months, if the effective annual interest is 8%.
19. A businessman is considering renting an operational restaurant. He has two options:
Restaurant 1: generates monthly gross income of €3,500 and expenses amount to €1,500.
In addition, the entrepreneur would need to make an initial investment of €4,000 to renew the
installations.
b) Restaurant 2: generates monthly gross income of €8,500 and expenses amount to €7,000.
but I would need to make an initial investment of 6,000 € to renovate the facilities.
Which option will be more interesting for you, considering that you will keep the business open for
the next 5 years? Interest rate: 1% effective monthly. Use a spreadsheet to perform the
calculations.
20. In light of the need to renew its computer equipment, a company carries out a
study of the different products available in the market, and select one
provider that offers you two payment options:
a) Option 1. Pay 1,000 € in cash and pay 600 € monthly for 2 years.
(overdue payments).
b) Option 2. Make quarterly and overdue payments of €400 for 3 years.
If the effective annual interest of the operation is 10%, calculate which alternative it
it is more advantageous. Use a spreadsheet to find the Present Value of both
options.
21. The company Córdova, S. L., needs to buy two diesel forklifts. Their supplier
habitual gives you the option to choose the following payment methods:
Option 1: pay €25,000 in cash.
b) Option 2: pay €15,000 as a down payment and the rest in 24 post-payable monthly installments of €400.
c) Option 3: pay €2,000 at the end of each quarter, for 3 years.
d) Option 4: make a payment of €15,000 at the time of purchase, and a second payment of €23,000 at
the 2 years of the purchase.
What is the most advantageous option for the company if we consider a 12% effective annual interest?
Use the spreadsheet to find options b) and c).
22. A farmer decides to rent a persimmon field for 5 years.
operating at full capacity and producing an average net profit
annual of €10,000. Calculate the value of this investment, if the operation is valued
at 6% annual effective. Use the spreadsheet to find the Present Value of the
operation.