Suppose that you decide to lease a car. At the end of the 48-month lease period, you need to make a lump-sum payment of $5000 if you want to keep the car. You decide to save up, just in case you decide to keep the car; if you don’t keep this car, you will still have saved a good down payment on a new car. You feel comfortable with saving $70/month (over and above your lease payments). How high an annual nominal interest rate on savings do you need to accumulate $5000 in 48 months, with interest compounded monthly?
How would I do this in Excel 2007? Is there a specific function I can use?
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