HP 20b Consultant Financial, 30b Professional manual Calculating Payments on a Loan

Page 36

Figure 1 illustrates a cash flow diagram and how the data in the diagram corresponds to the TVM keys. For a complete list of keys used for TVM problems, along with their descriptions, see Table 3-1.

To save values for the TVM variables, enter the desired number, followed by the corresponding TVM key. To calculate an unknown value, enter all known values and press the key of the item you want solved.

Table 3-1 TVM Keys

Keys

Description

 

 

N

Stores or calculates the number of payments or compounding periods.

 

 

:^

Multiplies a value by the number of payments per year and stores as N.

 

 

Y

Stores or calculates the nominal, annual interest rate.

 

 

V

Stores or calculates the present value (PV). To a lender or borrower, PV is the amount of a

loan; to an investor, PV is the initial investment. PV always occurs at the beginning of the first

 

period.

 

 

M

Stores or calculates the amount of each periodic payment.

 

 

:[

Stores the number of payments or compounding periods per year. This value is 12 by default,

but it maintains its current entered value when TVM Reset is used.

 

 

F

Stores or calculates the future value (FV), a final cash flow. FV always occurs at the end of the

last compounding period.

 

 

:?

Sets Begin mode (BEG). Payments occur at the beginning of each compounding period.

 

 

:]

Sets End mode (END). Payments occur at the end of each compounding period.

 

 

Calculating Payments on a Loan

You borrow 140,000.00 for 30 years (360 months) at 6.5% annual interest, compounded monthly. What is your monthly payment to the lender? Note: the following example is calculated with RPN set as the operating mode.

At the end of the 30 years, you expect to have a zero balance (FV=0). The example is calculated with RPN set as the operating mode

28 Time Value of Money

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Contents HP Part Number NW238-90001 Edition 1, December Legal Notice HP 20b Business Consultant HP 30b Business Professional On/Off/Cancel Line, alphanumeric scrolling Common MathematicalFunctions and Math Math Program menuPage Table of Contents Cash Flow Example Sample Cash Flow Diagrams Bonds Bond Menu Amortization Interest Conversion MenuCanadian Mortgage Example Black-Scholes MenuBasic Features Adjusting the Display ContrastWelcome to your new HP Financial Calculator Turning the Calculator On and OffMode Menu Setting Preferences CursorTwo Line Display Dd.mmyyyy Changing the Calculation Mode Primary, Secondary, and Tertiary Key Functions Using the Input and Equals Keys AnnunciatorsInput Key Equals KeyReset Menu Editing and Clearing Entries On/CE KeyAccessing Menus and Menu Maps Memory and the Memory MenuBasic Features Fixed Cost Price Profit Quantity DWNMathematical Calculations Mathematical FunctionsNumber Entry and Display Mathematical functions are locatedChain Mode Algebraic ModeReverse Polish Notation RPN Mode RPN StackIor =, followed by an operation key See -2for an example using the last number function Last NumberU3I O1c23 I56c+ 4 x 5 + 3I4 5I6Duplicating a Number on the Stack One-Number Functions and the Math Menu RPN Stack and the Swap OperationRandom number Math MenuDWN Probability Sub-menu 10I 12I15I3h Binomial FunctionsTwo-Number Functions Storing and Recalling Numbers Recall ArithmeticStoring and Recalling with Time Value of Money TVM Keys Recalling a Menu Item Value in a Menu Rounding NumbersPercentages Mathematical Calculations Time Value of Money Time Value of Money TVM KeysCalculating Payments on a Loan Stores or calculates the amount of each periodic payment360N 1400 00VAmortization Nb Per Start Balance Principal Interest10Y Creating an Amortization ScheduleAmortization Example KeysDisplayDescription Interest Conversion Menu To open the Interest Conversion menu IConv pressUsing the Interest Conversion Menu 360Canadian Mortgages TVM Canada DWNO300 N6Y35 0000 Canadian Mortgage ExampleCash Flows 000.00Cash Flow Example 8000 50004500 40001150 00IAnalyzing Cash Flows MirrInv. I% Safe I% DWN Mirr FmrrOpens the NPV menu Editing Cash Flows Displays FMRR% Sample Cash Flow Diagrams Sample Cash Flow Diagrams Cash FlowsBonds Set.Date Mat.DateBond Menu CPN%82010 42020Bond Calculation Example =L1+ Black-Scholes Calculation Menu Stock price Strike price Time to maturity Risk-free %Volatility % Dividend % Call price Put price Black-Scholes Menu Volatility % input Black-Scholes Example 80I 85I78I 72IPress to scroll to Date Calculation Date Calculation MenuDate Calculation Example Date Days Between Actual Cal.3602010 3120 10IBreak-even Break-even MenuBreak-even Example 1500 00I 250300 100 00IBusiness Problems Percent Calculation Menu15I Percent Calculation Examples20I 80I Is what % of 80?Depreciation Press Ito scroll through the options SlineBook Value Depreciable Depreciation Menu Soyd100 00I 500Depreciation Example Depreciation Statistical Operations Ax2+bx+c onlyData and Stats Menus Statistics Menu Items Description Std. Dev Statistics Example 1I1 50I 2I1 65I3I1 60I 4I1 75IStatistical Operations Programming Programming the HP 30bKey Presses for Program Instructions Hold Programming Example HoldProgram Step Reassigning Menu Functions Program Menu and Program Editing Followed by a label number to goTo a specific label Tests and Jump Functions Creates label 03 in your program. You canUse the following keystrokes to enter the program Long Programs and Battery Life Sub-Function Call05003$1 Other Programming FunctionsDSE ISG , followed by 1 digitMessages Calculates the volume Debugging a ProgramSaving, Restoring, and Modifying Mode Settings L1hL1-L2= Hold SolveProgramming Error Messages Error Messages and Calculator StatusError Messages Status ER Unique solution to IRR Not Found Warranty, Regulatory, and Contact Information HP Limited Hardware Warranty and Customer CareReplacing the Batteries General TermsWarranty, Regulatory, and Contact Information Modifications Canadian NoticeAvis Canadien European Union Regulatory NoticeLow Voltage Directive 2006/95/EC EMC Directive 2004/108/EC Contact Information Perchlorate Material special handling may applyCustomer Care 香港特別行政區 Martinica 08 5199 Country/Region Contact Vietnam +65-6272-5300 Viêt Nam Zambia Warranty, Regulatory, and Contact Information Symbols Calendar Cash flowChecksum 78 Combinations Date Debugging 85 DecimalInsert and delete keys Interest Conversion Internal rate of return Investment Rate KeyKey presses Keyboard map and legend Language MarginMath On HP 30b ParenthesesPercent Calculation Percentages PermutationsRPN Stop 83 StoreThousands separator Time Value of Money
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30b Professional, 20b Consultant Financial specifications

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