Rent or Buy Decision, 258,377.24, 18.00 | HP 12C Financial 12C

Section 12: Real Estate and Lending 163

Calculate the remaining balance of the loan after five years.

	Keystrokes	Keystrokes	Display
	(RPN mode)	(ALG mode)	Display
	(RPN mode)	(ALG mode)

	5gA	5gA	60.00

	M	M	258,377.24
		M	258,377.24

	:n	:n	60.00
	42-n	-42n	18.00
	250000Þ$	250000Þ$	1.01
	¼	¼	1.01
	12§	§12³	12.11

Number of periods to be amortized.

Remaining balance of the loan after five years.

New life of loan.

Percent monthly yield. (calculated).

Percent annual yield.

The Rent or Buy Decision

The question of whether to rent or purchase a residence is not always easy to answer, especially when the time period over which you would own or rent a house is short. This program performs an analysis which could be helpful in reaching a decision. Essentially, it calculates a yield or rate of return on the proposed investment. This yield may be compared with the yield obtained by renting a residence and investing the down payment and monthly payment differences in a savings account or other investment opportunity. This program takes into account the tax advantages obtained by a home owner on property taxes and mortgage interest.

First the program computes the Net Cash Proceeds upon Resale (NCPR),* next the yield on the investment in the house and then the value of the hypothetical savings account at the end of the investment period. A comparison of the NCPR and the final balance of the savings account and a comparison of the yields should aid in determining whether to rent or buy.

*The Net Cash Proceeds upon Resale (NCPR = sales price – commission – mortgage balance), is the pre-tax proceeds. The program assumes that the buyer reinvests in like property and is not subject to capital gains tax.

File name: hp 12c pt_user's guide_English_HDPMF123E27	Page: 163 of 275
Printed Date: 2005/8/1	Dimension: 14.8 cm x 21 cm

Image 163

HP 12C Financial 12C manual Rent or Buy Decision, 258,377.24, 18.00, 12.11

Contents

Hp 12c platinum financial calculator Printing History About This Handbook Introduction Financial Calculations in the United Kingdom For More Solutions to Financial ProblemsIntroduction Contents Section Contents Part II Programming 103 Part III Solutions 155 227 Appendix E Formulas Used 250 267 Making Financial Calculations Easy 14.00 48.00500.00 21,396.61 42.03 10,371.79168.00 11,024.82 Part Problem Solving Getting Started Power On and OffLow-Power Indication Adjusting the Display Contrast Negative Numbers Getting StartedKeying in Numbers Digit Separators 123.63 Keying in Large Numbers7814 Backspacing Keys Clears KeystrokesDisplay ALG mode63+ Clear Keys Example RPN mode ALG modeUndo Operation RPN and ALG Keys Keystrokes RPN mode Display Simple Arithmetic Calculations in RPN Mode13.00 Simple Arithmetic Calculations in ALG Mode 35.38 Chain Calculations in RPN ModeKeystrokes RPN mode 22.95 10.14 1053+ 42.00 30.00 Parentheses Calculations Chain Calculations in ALG Mode Storage Registers Keystrokes ALG mode 8zgØ5 1gÙ DisplayStoring and Recalling Numbers 500?2 Later that same day … Keystrokes Display RPN mode250.00 Keystrokes Display 1250?0 Storage Register Arithmetic Clearing Storage Registers58.33 064.54 13.7010.14 053.00 300 Percentages in RPN ModePercentage and Calendar Functions Percentage Functions Percentage and Calendar Functions Percentages in ALG Mode 22,673.40 860.0021,390.00 283.40 53.25 Keystrokes ALG mode DisplayPercent Difference 58.50 29.69 Percent of Total in RPN Mode Percent of Total in ALG Mode Date Format Calendar Functions Future or Past Dates 11,09,2004 14.05 491.00 Number of Days Between Dates11.09 498.00 Displaying Numbers in the Financial Registers Basic Financial FunctionsFinancial Registers Storing Numbers into the Financial Registers Basic Financial Functions Simple Interest CalculationsClearing the Financial Registers 455.18 60.00450.00 455.25 Financial Calculations and the Cash Flow Diagram Basic Financial Functions Cash Flow Sign Convention Payment Mode Generalized Cash Flow Diagrams Basic Financial Functions Calculating the Number of Payments or Compounding Periods Compound Interest Calculations 35,000.00 Stores PV Sets the payment mode to End325.00 143.11 328.0027.33 181.89 Recalls payment amount 327.00141.87 466.87 Stores FV GÂ n Keystrokes ALG mode775.00 50.00 4000 58.0029.00 50.00 977.27 10,000.00 Stores FV Keystrokes Display ALG mode 400022.73 Calculating the Periodic and Annual Interest Rates Calculating the Present Value Keystrokes RPN mode Keystrokes ALG mode 9gC 450ÞP 1500+ 369,494.09 12.0017,500.00 540,000.00 243,400.00 Stores PV Calculating the Future Value 200.0060,000.00 717.44 222,975.98 Amount of balloon payment Sets payment mode to End5gA 243400$ 243,400.00 1363.29ÞP -1,363.29 28,346.96 24.00281.34 32,000.00 Odd-Period Calculations Basic Financial Functions 135.17 0120045gC Z30+ §12 950.00120.00 GÒ z30+ Basic Financial Functions 250,000.00 AmortizationKeystrokes Display FCLEAR G Enters 25 gC 250000 $ 238.26 498.12970.91 245,029.09 380.51 093.75404.37 360.00 Discounted Cash Flow Analysis NPV and IRR Additional Financial Functions Calculating Net Present Value NPV Additional Financial Functions Negative cash flow 212.18 130,000.00 Year Cash Flow 10,000.00 79,000.0014,000.00 11,000.00 13.72 Calculating Internal Rate of Return IRR Reviewing Cash Flow Entries Changing Cash Flow Entries 100,000.00 500.00 14,000.00 79,000.00 857.21 644.75 120.38 Bond CalculationsBond Price 042018 122.13 Bond YieldTotal price, including accrued 2f# Depreciation Calculations400.00 1f# 660.00 440.003f# Continuous Memory Additional Operating Features Number Display Formats Additional Operating FeaturesStatus Indicators Display Scientific Notation Display Format 14.8746 14.9 14.87456320 1487456320 487456 Special Displays Key in RPN Mode Arithmetic Calculations With Constants 429,000.00 Recovering From Errors in Digit Entry Accumulating Statistics Statistics Functions Register Statistic Correcting Accumulated StatisticsMean Statistics Functions 35.00 32.0040.00 38.00 820.59 Standard Deviation463.00 Estimated sales for a 48 hour Linear Estimation28,818.93 Keystrokes Display 48 gQ GR~d~ Keystrokes RPN mode 0gR DisplayKeystrokes ALG mode 0gR 1gR~d-~ Display 001 Weighted Mean One-Number Functions Mathematics Number-Alteration Functions100 258 Mathematics and Number-Alteration Functions3880000000 Power Function in ALG Mode Power Function in RPN ModeKeystrokes To CalculateDisplay ALG mode Part Programming 104 Why Use Programs?Programming Basics Creating a Program 155.00 Programming Basics200 150.00 001 002 003 004 005 006 007 Running a Program 124.25 625473.75 159 Identifying Instructions in Program Lines Program Memory Instruction Keycode Nnn Nnn, 44Nnn,43,33,000 Displaying Program Lines Program memory Mode and displays current linePressing gÜdoes the reverse Keystrokes Display RPN mode Sets calculator to Program Keystrokes Display 008,43,33,000 Program line Expanding Program Memory 000 Instruction and Program Line Programming Basics Executing a Program One Line at a Time Setting the Calculator to a Particular Program Line Program line 006 Program line 002Program line 003 Program line 004 b Program line 005 + Interrupting Program Execution Pausing During Program Execution 68.5 119 Keystrokes RPN mode ?+1 ?+2 ?+3 Keystrokes ALG mode?+1 ?+2 ?+3 001 002 003 004 001 002004 005 006 008 60.11 012, 44 40950.61 890.50 003,44 004 005 006 402.82370.52 Stopping Program Execution FCLEAR² 13\68.5 18\72.9 24\85 Fourth item Simple Branching Branching and Looping125 Branching and Looping Looping 150,000.00 007,43,33,002782.47 188.72 007,43,33,002 593.75593.75 005 188.72 592.25 Conditional Branching190.22 Branching and Looping Recalls test value into X-register 006,43,33,008 004,43,33,007Stores income into register R9 20,000.00 006,43,33,009008,43,33,010 010 20,000 15,000.0015,000.00 004,43,33,007 15,000.00 007 25,000.00 005 20,000.00 00725,000 25,000.00 15,000.00 009 15,00015,000.00 005 15,000.00 006,43,33,009 Line 009 012,43,33,000 Line 012 gi000 000.00005, 43 34 Line 005 go 20,000.00 20,000.00 009 25.00 010 25,000.00 007 Changing the Instruction in a Program Line Program Editing139 Adding Instructions at the End of a Program Keystrokes RPN mode Keystrokes ALG mode Fs gi.006 DisplayProgram Editing 014 12,000.00012 013 Adding Instructions within a Program Adding Instructions by Replacement Fs 15000t Adding Instructions by Branching 016 Gi.010 Keystrokes RPN mode Fs gi.000001,43,33,012 011,43,33,000 014 015,43,33,000 016 012 013017,43,33,002 018 019 017,43,33,000020 021,43,33,000 022 Program Editing Storing Another Program Multiple Programs149 027,43,33,019 018,43,33,000019 020 021 022 023 024 025 026 029 030 031 032 025 026 027 028033,43,33,025 038 039 040,43 33,035 028 029 030 031032 033 034,43,33,029 034 035 036 037 Running Another Program Page Part Solutions Annual Percentage Rate Calculations With Fees Real Estate and Lending156 156,800.00 Real Estate and Lending160,000.00 908.46 156,050.00 159,250.00 72.00 Keystrokes Display RPN mode ALG mode 12§ §12³Keystrokes Display RPN mode ALG mode FCLEARG Price of a Mortgage Traded at a Discount or Premium 657.97 137.17777.61 312.00 252.00 Yield of a Mortgage Traded at a Discount or Premium300,000.00 210.00 096.57 12.11 Rent or Buy Decision258,377.24 18.00 008 009 010 011 012 013 014 015 016 017 018 019 020 021 000 001 002 003 004,44 005 006 007 RPN mode Registers Real Estate and Lending 270,000.00 165.00700.00 900.00 15,218.35 Keystrokes Display RPN mode ALG mode YieldDeferred Annuities 46,048.61 750.00 600.0012,831.75 000 001 002 003 004 005 006 007 008 009 010 011 Investment AnalysisPartial-Year Depreciation Straight-Line Depreciation 033,44 012 013 014 015 016 017 018 019 020 021 022 023 024025,43 026 027 028 029 030 031 032,44 037,43,33 036 037 038 039 040041,43,33 036,44 Investment Analysis 118,333.33 125,000.00666.67 123,333.33 000 001 002 003 004 005 006 007 008 009 730.00504.75 Declining-Balance Depreciation 029,44 010 011 012 013 014 015 016 017 018 019 020021,43 022 023 024 025 026 027 028,44 034 035 036 037 038 039 040 034 035 036 50,000.00 Sum-of-the-Years-Digits Depreciation 11,458.33 035 036 037 038 039 040 018 019 020 021 022 023 024025,43,33 026 027 028 029 030 031 042 043 044 500M Keystrokes Display RPN mode ALG mode FCLEARG 12000$25n Full- and Partial-Year Depreciation with Crossover 008 009 010 011 012 013 014 008 009 010 011?-0 041,44 042 032,43,33033 034 035 036 037 038 039 040,44 064,43,33 057,43,33058 059 060 061 062 063,44 094,43,33 080,44 081 082 083 084085,43,33 086 087 088 089 090 091 092 093 Keystrokes Display RPN mode ALG mode FCLEAR H 11000 $ 804.69 375.00125.00 406.25 531.25 Excess Depreciation10,500.00 312.50 Modified Internal Rate of Return 775,797.83 Group # of Months Cash Flow $200,000.00 657,152.37 Black-Scholes Formula for Valuing European Options Keystrokes Display Keystrokes Display 075,44 076 077 078 065 066 067 068 069 070071,43,33,077 073,44 074 089,44 090 089 090 091092,44 093 094 095 096,44 097 098 099 Program Instructions 199113 114,44 115 116 117 118,43,33 71.15 52.0020.54 14.22 20.00 10.00 202 LeasingAdvance Payments Solving for Payment 000 001 Leasing11.64 64.45 008 009 010 011 012 013 014 015 016 017 018 019 008 009 010 011 012 013 014 015 016 017 66.86 65.43 600 P Solving for Yield57.00 23,200.00 Percentage 17.33002 003 004 005 006 007 008 009 010 011 012 013 014 015 016 Annual yield as a ? t Keystrokes ALG mode017,45,43 19.48 Advance Payments With Residual 018 019 020 021 022 023 024 025 026 027 028 029 030 520.81 15.0022,000.00 487.29 34.00 710.0018.10 213 Keystrokes Display RPN mode ALG mode FCLEARG 25\ 25z 4nz¼Savings Nominal Rate Converted to Effective Rate 002 003 004 005 006 007 008 Savings002 003 004 005 006 007 008 009 010 ³ÞM¼ Effective Rate Converted to Nominal Rate 35 +Þ +5.35 ³Þ Keystrokes Display RPN mode ALG mode FCLEAR G N100 $Continuous Rate Converted to Effective Rate 105.35 217 Bonds30/360 Day Basis Bonds 001 002 003 004 005 006 007 008 009 010 011 012 013 014 015 016 017 018 019 020 021 022 023 024 025 026 027 028 014 015 016 017 018 019 020 021 022 023 024 025 026 027029 030 031 032 033 034 035 036 037 038,43,33 041 042 043 044 045 046 047 048 049 039 040 041 042 043 044 045 046Bonds 219 040,43,33 102.55 104.74 103.41 Annual Coupon Bonds 223 20 ?0 94.75 12.01Page Appendices 228 RPN and the Stack Appendix a RPN and the Stack Getting Numbers Into the Stack The Key Key Rearranging Numbers in the StackTermination of Digit Entry Stack Lift Two-Number Functions and the Stack One-Number Functions and the StackMathematics Functions Percentage Functions Register Calendar and Financial Functions Last X Register and the Key + 5 6 + Arithmetic Calculations with Constants 672,000.00 84,000168,000.00 336,000.00 237 Algebraic Mode ALG Keying in Negative Numbers Appendix B Algebraic Mode ALG532.50 18.5 § Key in ALG ModeHistory Stack in ALG Mode 400.43 737.07 8zgØ 1250+7b To Calculate Keystrokes Display ALG mode Power FunctionPercent of Total 243 More About L Appendix C More About L Error 0 Mathematics Error Conditions245 Error 4 Memory Error 1 Storage Register OverflowError 2 Statistics Error 3 IRR OperationCondition Error 5 Compound Interest Error 7 IRR Error 6 Storage RegistersOperation Condition Error 9 Service Error 8 CalendarPr Error Simple Interest Formulas UsedPercentage Interest Compound Interest Appendix E Formulas Used Calendar Discounted Cash Flow Analysis 200 Bonds Depreciation DPN J Finite Compounding Interest Rate ConversionsContinuous Compounding Standard Deviation Weighted MeanStatistics Linear Estimation Rent or Buy Decision 259 Battery, Warranty, Service InformationBattery Low-Power Indication Installing a New Battery Appendix F Battery, Warranty, and Service Information Verifying Proper Operation Self-Tests Appendix F Battery, Warranty, and Service Information Warranty Service USA Regulatory Information Japan Temperature SpecificationsNoise Declaration Canada Mortgages United Kingdom Calculations267 Appendix G United Kingdom Calculations Annual Percentage Rate APR Calculations 269 Financial Function Key IndexStatistics Stack Rearrangement ModesMathematics Number Alteration 272 Programming Key Index Run Mode Active KeysPressed from Keyboard 274 Subject Index Subject Index Subject Index Subject Index Subject Index