Sharp EL-738 1956, Conversion between APR and EFF, To change APR to EFF, To change EFF to APR

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Conversion between APR and EFF

Interest rates can be converted between APR (annual, or nomi- nal percentage rate) and EFF (effective interest rate).

•The APR is an investment’s annual rate of interest when com- pounding happens only once a year. The interest rate printed on a bond is an example of an APR.

•The EFF is an investment’s annual rate of interest when com- pounding happens more often than once a year. It reﬂects the actual amount of return for a given nominal rate. For example, if your investment compounds monthly, then the stated nomi- nal percentage rate becomes a monthly rate, and the EFF reﬂects your actual annual rate of return.

Basic operations

1.Press sto clear the display. Make sure the calculator is in NORMAL mode.

2.Enter the calculation data in the following format:

•To change APR to EFF:

Number of compounding periods per year >Nominal percentage rate .P

•To change EFF to APR:

Number of compounding periods per year >Effective interest rate .!

Converting between APR and EFF

Procedure		Key operation			Display

Calculate the	s12 >18 .P
effective interest
rate for twelve
compounding					12,18¬EFF
periods with an					12,18¬EFF
periods with an					1956
18% APR.					1956

Convert this rate	12	>	19.56	.!	12,19.56¬APR
Convert this rate		>		.!	12,19.56¬APR
back to the origi-					1800
nal APR.					1800

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Contents EL-738 Page Contents Introduction Operational NotesKey Notations in This Manual Using the .andKeys Resetting the calculator Resetting the Calculator In Case of DifﬁcultyPreparing to Use the Calculator Calculator layout Calculator and Display LayoutKey operation keys Display layout 2ndFSET UP Menu Selecting the display notation and number of decimal places3333333 0003000 Selecting the angular unit seeSelecting a mode Operations available in each modeOperating Modes Selecting the date format see14000 3439000 Basic Calculations⋅ ⋅ Delete keyEditing and Correcting an Entry Memory clear keyCursor keys Playback functionErrors Memory use in each mode for memory calculations500 192Temporary memories A-H, X-Z Independent memory MLast answer memory ANS TVM variablesMemory calculations Statistical variablesExample Key operation General Information Financial calculationsVariables used in ﬁnancial calculations Variables shared among calculationsTVM variables N, I/Y, PV, PMT, FV Basic variable operationsListed ﬁnancial variables ENT and Comp symbols Category Display symbols DescriptionsCash ﬂow diagrams Compound interestSetting the payment period payment due Variable Corresponding Description Default Variable keyTVM Time Value of Money Solver Variables used in the TVM solverBasic examples for the TVM solver Calculating basic loan interest1200 240005600000 44000400 8000125586 Calculating basic loan payments3600 20000FV= Calculating future value100 20001000000 376889Specifying payments due Ordinary annuity ENDAnnuity due BGN Ordinary annuity1800 30000000360 16245702400 2995014500 2995003400 150000627995 Calculating down payment and amount to borrow30000 90000550 14655892Amortization Calculations Variable Description Default valueVariables used in amortization 61656 8895148104852 203428600 1700384457 480048275524 1724476Discounted Cash Flow Analysis Entering cash ﬂow dataSingle cash ﬂows Repeated cash ﬂows000*2 200300 Conﬁrming and editing data2500000 Editing dataDeleting data Inserting data3000000 600000Variables used in discounted cash ﬂow analysis NPV and IRRProcedure Key operation Display Bring up the initial dis Play in Normal modeTo obtain NPV To obtain IRR2314 Calculating the present value of variable cash ﬂows662752 Bond Calculations Setting the day-count methodVariables used in bond calculations To obtain bond price Price PV To obtain yield to maturity Yield I/Y650 1000015-2023 720728 9250Entering dates Setting the depreciation method Depreciation CalculationsVariables used in depreciation calculations Key operation DescriptionPage 5000000 3000Calculating straight-line depreciation 1956 Conversion between APR and EFFTo change APR to EFF To change EFF to APRDay and Date Calculations Variables used in day and date calculations10-2009 22800Calculating number of days Answer 228 daysPercent Change/Compound Interest Cal- culations Procedure Key operation Display Move to the last dateCalculate 7500000 116000005467 800000980000 113Cost/Sell/Margin/Markup Calculations Variables used in cost/sell/margin/markup calcula- tions45560 950088842 Determining selling priceVariables used in breakeven calculations Breakeven CalculationsCalculating the breakeven point 1500000 758012000 33937Constant Calculations Chain Calculations087 0715000 4500Random Functions Random numbersRandom dice Random coinModify Function 532Random integer Entering statistical data For a single-variable data setFor a two-variable data set x value y value J Key operation Sub-mode DisplayEntering statistical data 1000 2000 Statistical Calculations and Variables Single-variable statistical calculationsLinear regression calculations Quadratic regression calculationVariables Content 17857 53000Single-variable statistical calculation Linear regression calculation Quadratic regression calculation Financial Calculation Formulas TVM solverAmortization calculations Discounted cash ﬂow analysisBond calculations Conversion between APR and EFF Depreciation calculationsDay and date calculations Cost/Sell/Margin/Markup calculations Statistical Calcula- tion FormulasBreakeven calculations Errors and Calculation Ranges Error codes and error typesSyntax error Error Calculation error ErrorEquation too long Error No solution ErrorDisplay error Error Input value error ErrorCalculation ranges of functions Function Calculation rangeInteger Battery Replacement When to replace the batteryAutomatic power-off function Replacement procedurePriority Levels in Calculations For more information about business/ ﬁnancial calculators SpeciﬁcationsKey operation and calculation priority Index Formulas, 72-75 FV, 18, 22, 72 GRAD, 8, 9, 61 Memo