# BA II Plus Advanced Business Analyst Calculator

Save this PDF as:

Size: px
Start display at page:

## Transcription

1 BA II Plus Advanced Business Analyst Calculator Quick Guide to Settings and Concepts Purpose of Guide This Quick Guide is a supplement to the BA II Plus Guidebook. It includes brief examples of commonly used BA II Plus calculator settings and financial management concepts. Refer to your BA II Plus Guidebook for detailed BA II Plus instructions. Keys and & Functions The primary function of each key is printed on the key. For example, press \$ to turn the calculator on or off. Some keys provide a secondary function. The secondary function is printed above the key. When you press the & key, the character, abbreviation, or word printed above a key becomes active for the next keystroke. For example, press & U to leave a prompted worksheet and return to standard-calculator mode. Copyright 1998 Texas Instruments Incorporated Part Number

2 Decimal Place Settings The BA II Plus displays two decimal places by default. You can change how many decimal places the calculator displays. You can display up to eight decimal places. To set the number of decimal places to four: & 4! DEC = & U This four-decimal setting continues indefinitely (even though the calculator is turned off and on), until you change it. 2

3 Payment and Compounding Settings (P/Y, C/Y) The BA II Plus defaults to 12 payments per year (P/Y) and 12 compounding periods per year (C/Y). You can change one or both of the settings to any number. The examples below assume the BA II Plus is set to four decimal places. To set both the P/Y and the C/Y to 1: & [ 1! P/Y = # C/Y = & U The above example shows annual compounding. You may want to set the P/Y to a different number than the C/Y. The following example shows how to set the BA II Plus for a monthly payment that is compounded quarterly. To set the P/Y to 12 and the C/Y to 4: & [ 12! P/Y = # C/Y = ! C/Y = & U The P/Y and C/Y settings continue indefinitely (even though the calculator is turned off and on), until you change them. To calculate the future value of a dollar: What is the future value of \$1.00 invested for five years at an interest rate of 7% compounded annually? For this example, set P/Y and C/Y to 1. & ^ S. PV = L , N = I/Y = % 0 FV =

4 Beginning- and End-of-Period Settings (BGN and END) The BA II Plus can assume that payments occur either at the beginning (BGN) of a period or at the end (END) of a period. The BA II Plus default setting is END. To set the calculator to beginning-of-period: & ] & V END BGN P A small BGN appears above the number display, indicating the mode is beginning-of-period. The BGN setting continues indefinitely (even though the calculator is turned off and on), until you change it. To set the calculator back to end-of-period: & ] & V BGN END P Once you press & ], the & V keys act as a toggle switch between BGN and END. 4

5 Resetting the Calculator Important: Reset the BA II Plus only when you want to erase all data stored in all memories and restore all settings to their factory defaults. Resetting the calculator: Reverts decimals to two places. Reverts P/Y and C/Y to 12. Reverts to end-of-period payments (END). Erases all numbers stored in all ten memories. Clears the display and any unfinished calculation. Returns the calculator to standard-calculator mode. Clears all worksheet data and restores the default worksheet settings. Refer to the Notes section for each worksheet in the BA II Plus Guidebook to see how reset affects specific worksheets. To clear all data and restore the calculator to factory defaults: & } RST? Lets you reconsider resetting the calculator You have two options: P (To cancel the reset operation) or! (To reset the calculator) Whether you cancel or reset the calculator, the BA II Plus returns to operation in the standard-calculator mode. 5

6 Clearing the Calculator Clearing the calculator is different from resetting it. You can clear one or more values while retaining other data, whereas resetting the calculator clears all data and restores all settings to factory defaults. To clear the calculator: To clear * One character at a time (including decimal points) P & U P P P & ^ & z * & { & z * An incorrect entry, an error condition, or error message All pending operations in standard-calculator mode or Out of a prompted worksheet and return to standardcalculator mode (values previously entered remain in the prompted worksheet) An unfinished calculation or A keyed, but not yet entered, variable value in a prompted worksheet or Out of a prompted worksheet and return to standardcalculator mode (values previously entered remain in the prompted worksheet) All values (N, I/Y, PV, PMT, FV) in the TVM (Time- Value-of-Money) worksheet A prompted worksheet (other than TVM) Also returns you to the first variable in the worksheet All values stored in all 10 memories 0 D and the key for the number of the memory (0-9) One memory * You must be in the worksheet you want to clear before using & z. Refer to the Notes section for each worksheet in the BA II Plus Guidebook to see how clearing affects specific worksheets. 6

7 Time-Value-of-Money (TVM) The TVM concept assumes a dollar today is worth more than a dollar in the future because the dollar received today can earn interest until the time the future dollar is received. Use the TVM worksheet to analyze equal cash flows such as loans, annuities, mortgages, leases, and savings. TVM variables There are five TVM variables, which you can enter in any sequence. You can check the value of any variable during the calculation by pressing J and the variable key. Variable Key Meaning, Total number of payment periods - Annual interest rate. Present value / Payment amount 0 Future value You will usually enter three variables and calculate the fourth. In some 0 calculations, you will enter four variables and calculate the fifth. Changing one variable does not affect either entered or calculated values in the other variables. Positive and negative cash flows In general, each Time-Value-of-Money problem will have at least two cash flows: one must be an outflow which is entered or computed as a negative value; the other must be an inflow which is entered or computed as a positive number. To clear the TVM worksheet: P 0.00 & ^ 0.00 The TVM examples use a two-decimal setting. 7

8 Time-Value-of-Money (TVM) (continued) To calculate a car payment: If your loan amount is \$15,000 with an interest rate of 6.9%, how much will you pay per month if you spread your payments over four years? For this example, set the BA II Plus to: Two decimal places 12 for P/Y and C/Y End-of-period payment Clear the TVM worksheet (see page 7) Do not clear the TVM worksheet again until you have completed the entire car payment example PV = 15, , N = payments per year for four years I/Y = 6.90 % / PMT = L Payment per month You can always change one or more variables and recompute. The next example changes the payment variable, without disturbing the other TVM variables. 300 S / PMT = L Payment is a negative number %, N = Almost five years If you want to repay the loan within four years, but need the payment to remain \$300.00, you could determine the interest rate you would need. 48, N = % - I/Y = L1.98 Since you probably won t find an interest rate that low, increasing your payment term to 60 months (five years) seems to be the most viable option. 8

9 Time-Value-of-Money (TVM) (continued) To calculate a mortgage payment: If your mortgage amount is \$150,000 with an interest rate of 8%, how much will you pay per month if you spread your payments over thirty years? For this example, set the BA II Plus to: Two decimal places 12 for P/Y and C/Y End-of-period payment Clear the TVM worksheet (see page 7) PV = 150, I/Y = & Z, N = payments per year for 30 years % / PMT = L1, Payment per month Your monthly payment will be \$1, To calculate the future value of a current amount: What is the future value of \$2, invested for 7 years at an annual percentage yield (APY) of 9? For this example, set the BA II Plus to: Two decimal places 1 for P/Y and C/Y End-of-period payment Clear the TVM worksheet (see page 7) 7, N = I/Y = S. PV = L2, % 0 FV = 3, The future value is \$3,

10 Time-Value-of-Money (TVM) (continued) To calculate monthly retirement income: If you are 25 years old and want to retire at age 60 with \$1,000,000.00, how much do you need to save each month? In this example, your savings account pays 6% interest, compounded monthly. For this example, set the BA II Plus to: Two decimal places 12 for P/Y and C/Y End-of-period payment Clear the TVM worksheet (see page 7) FV = 1,000, , N = monthly payments for 35 years 6 - I/Y = 6.00 % / PMT = L If saving \$ per month is too much, you can change one or more variables and recompute. Rather than seeing how much you need to save each month, the next example forecasts your monthly income. To calculate monthly income: Assuming you will live 20 years after retiring at age 60, and will earn 8% on your investments, what will be your monthly income from the \$1,000,000.00? For this example: Clear the TVM worksheet (see page 7) S. PV = L1,000, This is a negative number 240, N = Months from age 60 to I/Y = 8.00 Compounded monthly % / PMT = 8, If you saved \$1,000, by age 60, you could retire and receive \$8, per month for 20 years. 10

11 Bond Valuation You can use the BA II Plus to calculate bond maturity based on either an even or uneven number of years. An even number of years means that the month and day of the start and maturity dates are the same, with only the year changing. An uneven number of years means that the month and/or day vary, in addition to the year. For bond maturity based on an even number of years, use either the: TVM worksheet or Bond worksheet For bond maturity based on an uneven number of years, use the: Bond worksheet Examples of using both worksheets to calculate the value of a bond for an even number of years follow. To calculate the value of a bond using the TVM worksheet: Assume the current date is January 1, 1999 and you want to know the value of a bond that matures in 15 years (on January 1, 2014). The bond has a face value of \$1, and a coupon rate of 8%, which is paid semi-annually. Your required rate of return is 10%. For this example, set the BA II Plus to: 2 for P/Y and C/Y 4 decimal places End-of-period payment Clear the TVM worksheet (page 7) 30, N = payments Q 15 years 10 - I/Y = Annual interest rate 40 / PMT = % interest P 2 coupon payments per year FV = 1, Face value %. PV = L Present value 11

12 Bond Valuation (continued) To calculate the value of this bond using the Bond worksheet: Next, the Bond worksheet is used to calculate the example from the previous page. Refer to Chapter 5 of your BA II Plus Guidebook for Bond worksheet details. & l SDT = (Old contents) Access the worksheet & z (Old contents) You must be in a worksheet before you can clear it ! SDT = Start date # CPN = ! CPN = Coupon rate in percent # RDT = (Old contents) ! RDT = Redemption date # RV = % of redemption value # ACT Actual day-count method & V day-count method* # 2/Y Two coupons per year # YLD = ! YLD = Yield to redemption # PRI = % PRI = % of redemption value * Bonds are usually calculated on a 360 day year, rather than a 365 day year. 12

13 Cash Flow Analysis (CF) The BA II Plus Cash Flow worksheet analyzes unequal cash flows by calculating the internal rate of return (IRR) and/or net present value (NPV). While using any BA II Plus prompted worksheet, look for small words and symbols that appear in the top line of the display. These help you to remember what you can and cannot do within a worksheet. Refer to Chapter 2 of your BA II Plus Guidebook for an overview of worksheet operations, and to Chapter 4 for Cash Flow worksheet details. To calculate the IRR and NPV for a cash investment: This example assumes you have an investment of \$7,000 that is projected to generate a 20% return. Over the next six periods, the investment will generate the cash flows shown below. Year Cash Flow No. Cash Flow Estimate 1 1 3, ,000 each year 6 3 4,000 Next, you will access and clear the Cash Flow worksheet, enter the data, compute the IRR, and compute the NPV using an interest rate per period (I) of 20%. ' & z CFo = 0.00 You must be in a worksheet before you can clear it 7000 S! CFo = L7, Initial cash flow # 3000! C01 = 3, Cash flow for first year # F01 = 1.00 Frequency of C01 is 1 # 5000! C02 = 5, # 4! F02 = 4.00 Frequency of C02 is 4, which represents cash flows for years two through five # 4000! C03 = 4, Cash flow for sixth year # F03 = 1.00 Frequency of C03 is 1 13

14 Cash Flow Analysis (CF) (continued) To compute the internal rate of return (IRR): ) IRR = 0.00 Look for the word Compute in small letters at the top of the display % IRR = Look for an asterisk (*) in the display When the word Compute appears in the display, it means the only function you can perform is to compute the value of IRR. The asterisk (*) indicates a computed answer. To compute the net present value (NPV), using a 20% interest rate: ( I = 0.00 Look for the word Enter in small letters at the top of the display 20! I = # % NPV = 7, Compute the net present value When the word Enter appears in the display, it means you can enter a different interest rate. If you enter a different interest rate and press # %, the computed NPV reflects the change. When the NPV displays, you can press " to return to the interest rate and change it again. 14

15 Clearing the Statistics Worksheet The Statistics worksheet is comprised of two portions, data entry and statistical calculation. You enter values in the data-entry portion and compute results in the statistical-calculation portion. You must be in a worksheet before you can use & z to clear it. Be sure you are in the correct portion of the Statistics worksheet before you clear it. Refer to Chapter 7 of your BA II Plus Guidebook for Statistics worksheet details. To access and clear the data-entry portion of the worksheet: & j X01 Old contents appear, if any & z X01 = 0.00 To access the statistical calculation portion of the worksheet: You do not need to clear the statistical calculation portion of the worksheet because clearing the data portion of the Statistics worksheet leaves zero data to compute. & k LIN Standard linear regression & V to display other statistics calculation methods. The other calculation methods are: Ln Logarithmic regression EXP Exponential regression PWR Power regression 1-V One-variable statistics If the data portion of the worksheet contains information, press # to step through the calculated values. If the data portion of the worksheet does not contain information, an error message appears when you press #. 15

16 Storing and Using Values in Memory The BA II Plus has 10 separate memories. You can perform memory operations in either the standard-calculator mode or in the Memory worksheet. Refer to pages 1-16 and 8-19 in your BA II Plus Guidebook for Memory details. To store a value in memory: This example shows how to store the number 10 in memory 1 and the number 20 in memory 2. Repeat the process to store numbers in other memories. The memories are numbered 0 through D D To add stored values and store the sum in memory: You can perform mathematical operations other than addition on stored numbers. J 1 H J N D To display each value stored in memory: You can press J and a digit key 0 through 9 to display a previously stored value, or you can use the Memory worksheet to display stored values. This example uses the Memory worksheet. & { M0 = 0.00 You access the Memory worksheet # M1 = # M2 = # (repeat to display other memory values) M3 = After displaying M9, press # to return to M0. 16

17 Storing and Using Values in Memory (continued) To clear a stored value from memory: You can clear a value without disturbing values stored in other memories. A new value overwrites a previously stored value. Storing a value of zero is the same as clearing the memory. 0 D D D To clear all stored values from all memories: This erases all numbers stored in all memories and reverts M0 through M9 to & { M0 = Old contents appear, if any & z M0 =

18 Acknowledgments/Bibliography: Appreciation goes to the following for their contributions to the BA II Plus Quick Guide: Emery, Douglas R., and John D. Finnerty. Corporate Financial Management. Prentice-Hall, Inc., a Simon & Shuster Company, Upper Saddle River, NJ Keown, Arthur J., David F. Scott, Jr., John D. Martin, and J. William Petty. Basic Financial Management Seventh Edition. Prentice-Hall, Inc., a Simon & Shuster Company, Upper Saddle River, NJ Gallagher, Timothy J., and Joseph D. Andrew, Jr. Financial Management Principles and Practice. Prentice-Hall, Inc., a Simon & Shuster Company, Upper Saddle River, NJ By permission of the publisher. Adapted from Corporate Financial Management, Basic Financial Management Seventh Edition, and Financial Management Principles and Practice 1996 and Prentice Hall, Inc., Upper Saddle River, N.J. All rights reserved. For more information: TI-CARES ( ) 18

### Continue this process until you have cleared the stored memory positions that you wish to clear individually and keep those that you do not.

Texas Instruments (TI) BA II PLUS Professional The TI BA II PLUS Professional functions similarly to the TI BA II PLUS model. Any exceptions are noted here. The TI BA II PLUS Professional can perform two

### Using Financial and Business Calculators. Daniel J. Borgia

Using Financial and Business Calculators Daniel J. Borgia Table of Contents Texas Instruments (TI) BA-35 SOLAR......................................1 Texas Instruments (TI) BA II PLUS........................................11

### Using Financial And Business Calculators. Daniel J. Borgia

Using Financial And Business Calculators Daniel J. Borgia August 2000 Table of Contents I. Texas Instruments BA-35 SOLAR II. Texas Instruments BAII PLUS III. Hewlett Packard 12C IV. Hewlett Packard 17BII..

### Introduction. Turning the Calculator On and Off

Texas Instruments BAII PLUS Calculator Tutorial to accompany Cyr, et. al. Contemporary Financial Management, 1 st Canadian Edition, 2004 Version #6, May 5, 2004 By William F. Rentz and Alfred L. Kahl Introduction

### Course FM / Exam 2. Calculator advice

Course FM / Exam 2 Introduction It wasn t very long ago that the square root key was the most advanced function of the only calculator approved by the SOA/CAS for use during an actuarial exam. Now students

### Texas Instruments BAII Plus Tutorial for Use with Fundamentals 11/e and Concise 5/e

Texas Instruments BAII Plus Tutorial for Use with Fundamentals 11/e and Concise 5/e This tutorial was developed for use with Brigham and Houston s Fundamentals of Financial Management, 11/e and Concise,

### Texas Instruments BAII PLUS Tutorial

To begin, look at the face of the calculator. Almost every key on the BAII PLUS has two functions: each key's primary function is noted on the key itself, while each key's secondary function is noted in

### The explanations below will make it easier for you to use the calculator. The ON/OFF key is used to turn the calculator on and off.

USER GUIDE Texas Instrument BA II Plus Calculator April 2007 GENERAL INFORMATION The Texas Instrument BA II Plus financial calculator was designed to support the many possible applications in the areas

### Texas Instruments BAII PLUS Tutorial

Omar M. Al Nasser, Ph.D., MBA. Visiting Assistant Professor of Finance School of Business Administration University of Houston-Victoria Email: alnassero@uhv.edu Texas Instruments BAII PLUS Tutorial To

### Using Financial Calculators

Chapter 4 Discounted Cash Flow Valuation 4B-1 Appendix 4B Using Financial Calculators This appendix is intended to help you use your Hewlett-Packard or Texas Instruments BA II Plus financial calculator

### Hewlett Packard (HP) 10BII

Hewlett Packard (HP) 10BII The HP10BII is programmed to perform two basic types of operations: statistical operations and financial operations. Various types of computations are activated by depressing

### BA II PLUS Calculator

BA II PLUS Calculator 1997, 2002 Texas Instruments Incorporated Important Texas Instruments makes no warranty, either expressed or implied, including but not limited to any implied warranties of merchantability

### BA II PLUS Calculator

BA II PLUS Calculator Important Information Texas Instruments makes no warranty, either express or implied, including but not limited to any implied warranties of merchantability and fitness for a particular

### In this section, the functions of a financial calculator will be reviewed and some sample problems will be demonstrated.

Section 4: Using a Financial Calculator Tab 1: Introduction and Objectives Introduction In this section, the functions of a financial calculator will be reviewed and some sample problems will be demonstrated.

### BA II PLUS PROFESSIONAL Calculator

BA II PLUS PROFESSIONAL Calculator Important Information Texas Instruments makes no warranty, either express or implied, including but not limited to any implied warranties of merchantability and fitness

### Time-Value-of-Money and Amortization Worksheets

2 Time-Value-of-Money and Amortization Worksheets The Time-Value-of-Money and Amortization worksheets are useful in applications where the cash flows are equal, evenly spaced, and either all inflows or

### CALCULATOR TUTORIAL. Because most students that use Understanding Healthcare Financial Management will be conducting time

CALCULATOR TUTORIAL INTRODUCTION Because most students that use Understanding Healthcare Financial Management will be conducting time value analyses on spreadsheets, most of the text discussion focuses

### Compounding Assumptions. Compounding Assumptions. Financial Calculations on the Texas Instruments BAII Plus. Compounding Assumptions.

Compounding Assumptions Financial Calculations on the Texas Instruments BAII Plus This is a first draft, and may contain errors. Feedback is appreciated The TI BAII Plus has built-in preset assumptions

### HANDBOOK: HOW TO USE YOUR TI BA II PLUS CALCULATOR

HANDBOOK: HOW TO USE YOUR TI BA II PLUS CALCULATOR This document is designed to provide you with (1) the basics of how your TI BA II Plus financial calculator operates, and (2) the typical keystrokes that

### Main TVM functions of a BAII Plus Financial Calculator

Main TVM functions of a BAII Plus Financial Calculator The BAII Plus calculator can be used to perform calculations for problems involving compound interest and different types of annuities. (Note: there

### BA II Plus. Guidebook. Texas Instruments Instructional Communications. Dave Caldwell David Santucci Gary Von Berg

BA II Plus Guidebook Guidebook developed by: Texas Instruments Instructional Communications With contributions by: Dave Caldwell David Santucci Gary Von Berg 1997 by Texas Instruments Incorporated. Important

### Time Value of Money. Reading 5. IFT Notes for the 2015 Level 1 CFA exam

Time Value of Money Reading 5 IFT Notes for the 2015 Level 1 CFA exam Contents 1. Introduction... 2 2. Interest Rates: Interpretation... 2 3. The Future Value of a Single Cash Flow... 4 4. The Future Value

### Texas Instruments BA II Plus. Calculator tutorial

Chartered Financial Analyst Program Texas Instruments BA II Plus calculator tutorial Nicholas J Blain, CFA Chief Executive Quartic Training 1 outline 0. Calculator setup and introduction 1. Basic algebra

### PV Tutorial Using Calculator (Sharp EL-738)

EYK 15-2 PV Tutorial Using Calculator (Sharp EL-738) TABLE OF CONTENTS Calculator Configuration and Abbreviations Exercise 1: Exercise 2: Exercise 3: Exercise 4: Exercise 5: Exercise 6: Exercise 7: Exercise

### Key Concepts and Skills

McGraw-Hill/Irwin Copyright 2014 by the McGraw-Hill Companies, Inc. All rights reserved. Key Concepts and Skills Be able to compute: The future value of an investment made today The present value of cash

### Sharp EL-733A Tutorial

To begin, look at the face of the calculator. Almost every key on the EL-733A has two functions: each key's primary function is noted on the key itself, while each key's secondary function is noted in

### Time Value of Money. 2014 Level I Quantitative Methods. IFT Notes for the CFA exam

Time Value of Money 2014 Level I Quantitative Methods IFT Notes for the CFA exam Contents 1. Introduction... 2 2. Interest Rates: Interpretation... 2 3. The Future Value of a Single Cash Flow... 4 4. The

### The Time Value of Money

The following is a review of the Quantitative Methods: Basic Concepts principles designed to address the learning outcome statements set forth by CFA Institute. This topic is also covered in: The Time

### Calculator (Hewlett-Packard 10BII) Tutorial

UNDERSTANDING HEALTHCARE FINANCIAL MANAGEMENT Calculator (Hewlett-Packard 10BII) Tutorial To begin, look at the face of the calculator. Most keys (except a few) have two functions: Each key s primary function

### TIME VALUE OF MONEY. Hewlett-Packard HP-12C Calculator

SECTION 1, CHAPTER 6 TIME VALUE OF MONEY CHAPTER OUTLINE Clues, Hints, and Tips Present Value Future Value Texas Instruments BA II+ Calculator Hewlett-Packard HP-12C Calculator CLUES, HINTS, AND TIPS Present

### Hewlett-Packard 10BII Tutorial

This tutorial has been developed to be used in conjunction with Brigham and Houston s Fundamentals of Financial Management 11 th edition and Fundamentals of Financial Management: Concise Edition. In particular,

### BEST INTEREST RATE. To convert a nominal rate to an effective rate, press

FINANCIAL COMPUTATIONS George A. Jahn Chairman, Dept. of Mathematics Palm Beach Community College Palm Beach Gardens Location http://www.pbcc.edu/faculty/jahng/ The TI-83 Plus and TI-84 Plus have a wonderful

### BA-35 Solar Quick Reference Guide

BA-35 Solar Quick Reference Guide Table of Contents General Information... 2 The Display... 4 Arithmetic Operations... 6 Correcting Errors... 7 Display Formats... 8 Memory Operations... 9 Math Operations...

### 1. If you wish to accumulate \$140,000 in 13 years, how much must you deposit today in an account that pays an annual interest rate of 14%?

Chapter 2 - Sample Problems 1. If you wish to accumulate \$140,000 in 13 years, how much must you deposit today in an account that pays an annual interest rate of 14%? 2. What will \$247,000 grow to be in

### Time Value of Money. 2014 Level I Quantitative Methods. IFT Notes for the CFA exam

Time Value of Money 2014 Level I Quantitative Methods IFT Notes for the CFA exam Contents 1. Introduction...2 2. Interest Rates: Interpretation...2 3. The Future Value of a Single Cash Flow...4 4. The

### Hewlett-Packard 10B Tutorial

To begin, look at the face of the calculator. Every key (except one, the gold shift key) on the 10B has two functions: each key's primary function is noted in white on the key itself, while each key's

### Module 5: Interest concepts of future and present value

file:///f /Courses/2010-11/CGA/FA2/06course/m05intro.htm Module 5: Interest concepts of future and present value Overview In this module, you learn about the fundamental concepts of interest and present

### appendix B COMPOUND SUM OF AN ANNUITY OF \$1 appendix C PRESENT VALUE OF \$1 appendix D PRESENT VALUE OF AN ANNUITY OF \$1

appendices appendix A COMPOUND SUM OF \$1 appendix B COMPOUND SUM OF AN ANNUITY OF \$1 appendix C PRESENT VALUE OF \$1 appendix D PRESENT VALUE OF AN ANNUITY OF \$1 appendix E TIME VALUE OF MONEY AND INVESTMENT

### substantially more powerful. The internal rate of return feature is one of the most useful of the additions. Using the TI BA II Plus

for Actuarial Finance Calculations Introduction. This manual is being written to help actuarial students become more efficient problem solvers for the Part II examination of the Casualty Actuarial Society

### Key Concepts and Skills. Multiple Cash Flows Future Value Example 6.1. Chapter Outline. Multiple Cash Flows Example 2 Continued

6 Calculators Discounted Cash Flow Valuation Key Concepts and Skills Be able to compute the future value of multiple cash flows Be able to compute the present value of multiple cash flows Be able to compute

### Chapter 4 Discounted Cash Flow Valuation

University of Science and Technology Beijing Dongling School of Economics and management Chapter 4 Discounted Cash Flow Valuation Sep. 2012 Dr. Xiao Ming USTB 1 Key Concepts and Skills Be able to compute

### Chapter 5 & 6 Financial Calculator and Examples

Chapter 5 & 6 Financial Calculator and Examples Konan Chan Financial Management, Spring 2016 Five Factors in TVM Present value: PV Future value: FV Discount rate: r Payment: PMT Number of periods: N Get

### Chapter 4 Time Value of Money ANSWERS TO END-OF-CHAPTER QUESTIONS

Chapter 4 Time Value of Money ANSWERS TO END-OF-CHAPTER QUESTIONS 4-1 a. PV (present value) is the value today of a future payment, or stream of payments, discounted at the appropriate rate of interest.

### DISCOUNTED CASH FLOW VALUATION and MULTIPLE CASH FLOWS

Chapter 5 DISCOUNTED CASH FLOW VALUATION and MULTIPLE CASH FLOWS The basic PV and FV techniques can be extended to handle any number of cash flows. PV with multiple cash flows: Suppose you need \$500 one

### Purpose EL-773A HP-10B BA-II PLUS Clear memory 0 n registers

D-How to Use a Financial Calculator* Most personal finance decisions involve calculations of the time value of money. Three methods are used to compute this value: time value of money tables (such as those

### Prepared by: Dalia A. Marafi Version 2.0

Kuwait University College of Business Administration Department of Finance and Financial Institutions Using )Casio FC-200V( for Fundamentals of Financial Management (220) Prepared by: Dalia A. Marafi Version

### SUPPLEMENTARY NOTES. For examination purposes, the following amendments shall take effect from 3 June 2011: 1. Chapter 12, Page 329, Chapter Outline

SUPPLEMENTARY NOTES ChFC01 Fundamentals Of Financial Planning And Investments Date Of Issue : 3 May 2011 [Applicable to 1 st Edition (2003), Re-printed March 2006 version and earlier] The following amendments

### Discounted Cash Flow Valuation

Discounted Cash Flow Valuation Chapter 5 Key Concepts and Skills Be able to compute the future value of multiple cash flows Be able to compute the present value of multiple cash flows Be able to compute

### Oklahoma State University Spears School of Business. Time Value of Money

Oklahoma State University Spears School of Business Time Value of Money Slide 2 Time Value of Money Which would you rather receive as a sign-in bonus for your new job? 1. \$15,000 cash upon signing the

### CALCULATOR HINTS ANNUITIES

CALCULATOR HINTS ANNUITIES CALCULATING ANNUITIES WITH THE FINANCE APP: Select APPS and then press ENTER to open the Finance application. SELECT 1: TVM Solver The TVM Solver displays the time-value-of-money

### Chapter The Time Value of Money

Chapter The Time Value of Money PPT 9-2 Chapter 9 - Outline Time Value of Money Future Value and Present Value Annuities Time-Value-of-Money Formulas Adjusting for Non-Annual Compounding Compound Interest

### Notes on the SHARP EL-738 calculator

Chapter 1 Notes on the SHARP EL-738 calculator General The SHARP EL-738 calculator is recommended for this module. The advantage of this calculator is that it can do basic calculations, financial calculations

### Integrated Case. 5-42 First National Bank Time Value of Money Analysis

Integrated Case 5-42 First National Bank Time Value of Money Analysis You have applied for a job with a local bank. As part of its evaluation process, you must take an examination on time value of money

### BASICS. Access blue functions with [Shift up] Access orange functions with [Shift down]

CALCULATOR COURSE BASICS Most keys have three functions: Primary function printed in white Secondary function printed in orange Tertiary function printed in blue Access blue functions with [Shift up] Access

### Finance Application for the TI-89 / TI-92 Plus

Finance Application for the TI-89 / TI-92 Plus Important Information 2 Where to Find Installation Instructions 3 The Time-Value-of-Money (TVM) Solver 4 Editing Values in the TVM Solver 5 Calculating TVM

### The Mathematics of Financial Planning (supplementary lesson notes to accompany FMGT 2820)

The Mathematics of Financial Planning (supplementary lesson notes to accompany FMGT 2820) Using the Sharp EL-738 Calculator Reference is made to the Appendix Tables A-1 to A-4 in the course textbook Investments:

### Note: In the authors opinion the Ativa AT 10 is not recommended as a college financial calculator at any level of study

Appendix 1: Ativa AT 10 Instructions Note: DNS = Does Not Calculate Note: Loan and Savings Calculations Automatically round to two decimals. -Clear -Store Data in Memory -Recall Stored Data in Memory [CE]

### BEFORE YOU CAN DO ANYTHING WITH THIS CALCULATOR YOU MUST LEARN THE RITUAL OF CALCULATOR PURIFICATION.

Brief Tutorial for the Texas Instruments BAII PLUS Part One By John Stansfield, CFA, Ph D, MBA, and calculator enthusiast. The Texas Instruments BAII PLUS is the only calculator for the well-dressed finance

### TIME VALUE OF MONEY #6: TREASURY BOND. Professor Peter Harris Mathematics by Dr. Sharon Petrushka. Introduction

TIME VALUE OF MONEY #6: TREASURY BOND Professor Peter Harris Mathematics by Dr. Sharon Petrushka Introduction This problem assumes that you have mastered problems 1-5, which are prerequisites. In this

### Chapter 02 How to Calculate Present Values

Chapter 02 How to Calculate Present Values Multiple Choice Questions 1. The present value of \$100 expected in two years from today at a discount rate of 6% is: A. \$116.64 B. \$108.00 C. \$100.00 D. \$89.00

### first complete "prior knowlegde" -- to refresh knowledge of Simple and Compound Interest.

ORDINARY SIMPLE ANNUITIES first complete "prior knowlegde" -- to refresh knowledge of Simple and Compound Interest. LESSON OBJECTIVES: students will learn how to determine the Accumulated Value of Regular

### TVM Appendix B: Using the TI-83/84. Time Value of Money Problems on a Texas Instruments TI-83 1

Before you start: Time Value of Money Problems on a Texas Instruments TI-83 1 To calculate problems on a TI-83, you have to go into the applications menu, the blue APPS key on the calculator. Several applications

### Chapter 2 Applying Time Value Concepts

Chapter 2 Applying Time Value Concepts Chapter Overview Albert Einstein, the renowned physicist whose theories of relativity formed the theoretical base for the utilization of atomic energy, called the

### The values in the TVM Solver are quantities involved in compound interest and annuities.

Texas Instruments Graphing Calculators have a built in app that may be used to compute quantities involved in compound interest, annuities, and amortization. For the examples below, we ll utilize the screens

### HOW TO USE YOUR HP 12 C CALCULATOR

HOW TO USE YOUR HP 12 C CALCULATOR This document is designed to provide you with (1) the basics of how your HP 12C financial calculator operates, and (2) the typical keystrokes that will be required on

### Topics. Chapter 5. Future Value. Future Value - Compounding. Time Value of Money. 0 r = 5% 1

Chapter 5 Time Value of Money Topics 1. Future Value of a Lump Sum 2. Present Value of a Lump Sum 3. Future Value of Cash Flow Streams 4. Present Value of Cash Flow Streams 5. Perpetuities 6. Uneven Series

### Introduction to the Hewlett-Packard (HP) 10BII Calculator and Review of Mortgage Finance Calculations

Introduction to the Hewlett-Packard (HP) 10BII Calculator and Review of Mortgage Finance Calculations Real Estate Division Sauder School of Business University of British Columbia Introduction to the Hewlett-Packard

### Hewlett-Packard 17BII Tutorial

To begin, look at the face of the calculator. Most keys on the 17BII have two functions: a key's primary function is noted in white on the key itself, while the key's secondary function is noted in gold

### USING FINANCIAL CALCULATORS

lwww.wiley.com/col APPEDIX C USIG FIACIAL CALCULATORS OBJECTIVE 1 Use a financial calculator to solve time value of money problems. Illustration C-1 Financial Calculator Keys Business professionals, once

### CFALA Review: Tips for using the TI calculator 2/9/2015. Using the TI BA2+

CFALA REVIEW MATERIALS USING THE TI-BAII PLUS CALCULATOR David Cary, PhD, CFA Spring 2015 dcary@dcary.com (helpful if you put CFA Review in subject line) Using the TI BA2+ Notes by David Cary These should

### Module 5: Interest concepts of future and present value

Page 1 of 23 Module 5: Interest concepts of future and present value Overview In this module, you learn about the fundamental concepts of interest and present and future values, as well as ordinary annuities

### 2016 Wiley. Study Session 2: Quantitative Methods Basic Concepts

2016 Wiley Study Session 2: Quantitative Methods Basic Concepts Reading 5: The Time Value of Money LESSO 1: ITRODUCTIO, ITEREST RATES, FUTURE VALUE, AD PREST VALUE The Financial Calculator It is very important

### FinQuiz Notes 2 0 1 4

Reading 5 The Time Value of Money Money has a time value because a unit of money received today is worth more than a unit of money to be received tomorrow. Interest rates can be interpreted in three ways.

### TI-86 Financial Functions

TI-86 Financial Functions Loading and Installing Finance Features on Your TI-86... 2 Loading the Finance Features into TI-86 Memory... 2 Installing the Finance Features for Use... 2 Displaying the FIN

### hp calculators HP 12C Net Present Value Cash flow and NPV calculations Cash flow diagrams The HP12C cash flow approach Practice solving NPV problems

Cash flow and NPV calculations Cash flow diagrams The HP12C cash flow approach Practice solving NPV problems How to modify cash flow entries Cash Flow and NPV calculations Cash flow analysis is an extension

### PV Tutorial Using Excel

EYK 15-3 PV Tutorial Using Excel TABLE OF CONTENTS Introduction Exercise 1: Exercise 2: Exercise 3: Exercise 4: Exercise 5: Exercise 6: Exercise 7: Exercise 8: Exercise 9: Exercise 10: Exercise 11: Exercise

### 2. How many months will it take to pay off a \$9,000 loan with monthly payments of \$225? The APR is 18%.

Lesson 1: The Time Value of Money Study Questions 1. Your mother, who gave you life (and therefore everything), has encouraged you to borrow \$65,000 in student loans. The interest rate is a record-low

### USING THE SHARP EL 738 FINANCIAL CALCULATOR

USING THE SHARP EL 738 FINANCIAL CALCULATOR Basic financial examples with financial calculator steps Prepared by Colin C Smith 2010 Some important things to consider 1. These notes cover basic financial

### MODEL EL-738 BUSINESS/FINANCIAL CALCULATOR OPERATION MANUAL

MODEL EL-738 BUSINESS/FINANCIAL CALCULATOR OPERATION MANUAL NOTICE SHARP makes no guarantee that this product or this manual is suitable or accurate for any purpose, commercial or otherwise. Rules and

### Discounted Cash Flow Valuation

6 Formulas Discounted Cash Flow Valuation McGraw-Hill/Irwin Copyright 2008 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter Outline Future and Present Values of Multiple Cash Flows Valuing

### Math Workshop Algebra (Time Value of Money; TVM)

Math Workshop Algebra (Time Value of Money; TVM) FV 1 = PV+INT 1 = PV+PV*I = PV(1+I) = \$100(1+10%) = \$110.00 FV 2 = FV 1 (1+I) = PV(1+I)(1+I) = PV(1+I) 2 =\$100(1.10) 2 = \$121.00 FV 3 = FV 2 (1+I) = PV(1

### Bank: The bank's deposit pays 8 % per year with annual compounding. Bond: The price of the bond is \$75. You will receive \$100 five years later.

ü 4.4 lternative Discounted Cash Flow Decision Rules ü Three Decision Rules (1) Net Present Value (2) Future Value (3) Internal Rate of Return, IRR ü (3) Internal Rate of Return, IRR Internal Rate of Return

### HP 12C Calculations. 2. If you are given the following set of cash flows and discount rates, can you calculate the PV? (pg.

HP 12C Calculations This handout has examples for calculations on the HP12C: 1. Present Value (PV) 2. Present Value with cash flows and discount rate constant over time 3. Present Value with uneven cash

### Chapter 8. 48 Financial Planning Handbook PDP

Chapter 8 48 Financial Planning Handbook PDP The Financial Planner's Toolkit As a financial planner, you will be doing a lot of mathematical calculations for your clients. Doing these calculations for

### Review Page 468 #1,3,5,7,9,10

MAP4C Financial Student Checklist Topic/Goal Task Prerequisite Skills Simple & Compound Interest Video Lesson Part Video Lesson Part Worksheet (pages) Present Value Goal: I will use the present value formula

### 14 Financial. Functions. Financial Functions 14-1. Contents

14 Financial Functions Contents Getting Started: Financing a Car... 14-2 Getting Started: Computing Compound Interest... 14-3 Using the TVM Solver... 14-4 Using the Financial Functions... 14-5 Calculating

### MHSA 8630 -- Healthcare Financial Management Time Value of Money Analysis

MHSA 8630 -- Healthcare Financial Management Time Value of Money Analysis ** One of the most fundamental tenets of financial management relates to the time value of money. The old adage that a dollar in

### Chapter 4: Time Value of Money

Chapter 4: Time Value of Money BASIC KEYS USED IN FINANCE PROBLEMS The following two key sequences should be done before starting any "new" problem: ~ is used to separate key strokes (3~N: enter 3 then

### Excel Financial Functions

Excel Financial Functions PV() Effect() Nominal() FV() PMT() Payment Amortization Table Payment Array Table NPer() Rate() NPV() IRR() MIRR() Yield() Price() Accrint() Future Value How much will your money

### Chapter 6. Discounted Cash Flow Valuation. Key Concepts and Skills. Multiple Cash Flows Future Value Example 6.1. Answer 6.1

Chapter 6 Key Concepts and Skills Be able to compute: the future value of multiple cash flows the present value of multiple cash flows the future and present value of annuities Discounted Cash Flow Valuation

### The Time Value of Money

C H A P T E R6 The Time Value of Money When plumbers or carpenters tackle a job, they begin by opening their toolboxes, which hold a variety of specialized tools to help them perform their jobs. The financial

### hp calculators HP 12C Internal Rate of Return Cash flow and IRR calculations Cash flow diagrams The HP12C cash flow approach

Cash flow and IRR calculations Cash flow diagrams The HP12C cash flow approach Practice with solving cash flow problems related to IRR How to modify cash flow entries Cash Flow and IRR calculations Cash

### REVIEW MATERIALS FOR REAL ESTATE ANALYSIS

REVIEW MATERIALS FOR REAL ESTATE ANALYSIS 1997, Roy T. Black REAE 5311, Fall 2005 University of Texas at Arlington J. Andrew Hansz, Ph.D., CFA CONTENTS ITEM ANNUAL COMPOUND INTEREST TABLES AT 10% MATERIALS

### Ch. Ch. 5 Discounted Cash Flows & Valuation In Chapter 5,

Ch. 5 Discounted Cash Flows & Valuation In Chapter 5, we found the PV & FV of single cash flows--either payments or receipts. In this chapter, we will do the same for multiple cash flows. 2 Multiple Cash

### Review for Exam 1. Instructions: Please read carefully

Review for Exam 1 Instructions: Please read carefully The exam will have 20 multiple choice questions and 4 work problems. Questions in the multiple choice section will be either concept or calculation

### CHAPTER 9 Time Value Analysis

Copyright 2008 by the Foundation of the American College of Healthcare Executives 6/11/07 Version 9-1 CHAPTER 9 Time Value Analysis Future and present values Lump sums Annuities Uneven cash flow streams

### Solutions to Time value of money practice problems

Solutions to Time value of money practice problems Prepared by Pamela Peterson Drake 1. What is the balance in an account at the end of 10 years if \$2,500 is deposited today and the account earns 4% interest,

### Problem Set: Annuities and Perpetuities (Solutions Below)

Problem Set: Annuities and Perpetuities (Solutions Below) 1. If you plan to save \$300 annually for 10 years and the discount rate is 15%, what is the future value? 2. If you want to buy a boat in 6 years