![]() ![]() Set calculator to BGN mode Input $0 PV Input 10 I/Y Input 3 N Input $100 PMT Calculate FV (Cpt FV) 2ND 2ND PV I/Y N PMT CPT FV Copyright by Diane Scott Docking 2015Ĥ. Here are the key strokes: 10 3 100 FV will be a NEGATIVE $ Ignore negative sign. Input $0 PV Input 10 I/Y Input 3 N Input $100 PMT Calculate FV (Cpt FV) PV I/Y N PMT CPT FV Copyright by Diane Scott Docking 2015ġ6 Example 2: What’s the FV of a 3-year annuity due of $100 at 10%?ġ 2 3 10% $100 100 100 110 100(1.10)= FV = 121 100(1.10)2= 100(1.10)3= 133.10 $364.10 Copyright by Diane Scott Docking 2015ġ7 Financial Calculator Input: FV of an annuity due Here are the key strokes: 10 3 100 FV will be a NEGATIVE $331. FV of an annuity Example 1: What is the FV of a 3-year ordinary annuity of $100 at 10%? 1 2 3 10% 10% 10% $100 100 100 100(1.10)= 110 FV = 100(1.10)2= 121 $331 Copyright by Diane Scott Docking 2015ġ5 Financial Calculator Input: FV of an ordinary annuity FV Input $100 FV Input 10 I/Y Input 3 N Input 0 PMT Calculate PV (Cpt PV) I/Y N PMT CPT PV Copyright by Diane Scott Docking 2015ģ. Here are the key strokes: 100 10 3 PV will be a NEGATIVE $75.13. 10 = interest $ 9.09 balance $90.90 FV = $99.99 = $100 Copyright by Diane Scott Docking 2015ġ3 Financial Calculator Input: PV of a Lump Sum Input -$1000 PV Input 8 I/Y Input 20 N Input 0 PMT Calculate FV (Cpt FV) +│─ PV I/Y N PMT CPT FV Copyright by Diane Scott Docking 2015Ģ. How much will she have in 20 years? FVn = PV(1+i) n FV20 = $1,000 (1.08)20 = $4,660.96 Here are the key strokes: 1000 8 20 FV will be a POSITIVE $4,660.96 By convention we put PV in as a negative number, so that FV will be positive. ![]() +│─ PV Input -$100 PV Input 10 I/Y Input 3 N Input 0 PMT Calculate FV (Cpt FV) Is FV positive or negative? Why? What’s the deal? I/Y N PMT CPT FV Copyright by Diane Scott Docking 2015 Here are the key strokes: 100 10 3 FV will be a POSITIVE $ By convention we put PV in as a negative number, so that FV will be positive. Copyright by Diane Scott Docking 2015ġ0 Financial Calculator Input: FV of a Lump Sum = $30 in interest if withdraw interest each year. 10 = Interest $ Principal $100 Balance $110 x. FV of a Lump Sum: What’s the FV of an initial $100 investment after 3 years if i = 10%? 1 2 3 10% 100 FV = ? $100 x. FV Input $1,000 FV Input 12 I/Y Input 1 N Input 0 PMT Calculate PV (Cpt PV) Is PV positive or negative? Why? What’s the deal? I/Y N PMT CPT PV Copyright by Diane Scott Docking 2015ġ. The negative sign simply means you invested (had a cash outflow). A -$ But answer is $ By convention we put PV in as a negative number, so that FV will be positive. Here are the key strokes: 1000 12 1 PV will be NEGATIVE. 12 = $ interest earned plus initial investment = $ yields = $1,000.00 Copyright by Diane Scott Docking 2015Ĩ Financial Calculators & Cash Flow Sign Convention Time is Money $100 in your hand today is worth more or less than $100 in one year? Money earns interest The higher the interest rate, the faster your money grows Q: How much would $1,000 promised in one year be worth today if you could be earning 12% interest? Copyright by Diane Scott Docking 2015 7% is entered as 7) PV and FV must carry opposite signs (‘+’ or ‘-’) PMT must carry the same sign as either the PV or the FV, whichever is appropriate Some calculators distinguish between inflows and outflows Cash flow sign convention: If a PV is entered as negative the computed FV is positive Copyright by Diane Scott Docking 2015 Has embedded formulas Five time value keys: N, I/Y, PV, PMT, FV Use either four or five keys Interest rate (I/Y) is entered as a whole number, not a decimal (e.g. I/Y PMT FV PV Number of time periods Interest rate (%) Future Value Present Value Payment Basic Calculator Keys Copyright by Diane Scott Docking 2015 ![]() Use one period per year: P/Y = 1 1 Set decimal to 6 places: Format DEC=6 6 Set BGN register to “END” 2ND ENTER 2ND ENTER Copyright by Diane Scott Docking 2015 Learning Objectives To learn how to use the Financial Calculator Copyright by Diane Scott Docking 2015ģ TI BA II+ Calculator Setup-Follow This!! ![]()
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