HP 30b Professional, 20b Consultant Financial manual Analyzing Cash Flows

Analyzing Cash Flows

The various functions used to analyze cash flows are located in the NPV Pand IRR R

menus. If you press Ror Pbefore entering cash flows, you will be redirected to the

cash flow menu to enter values into the cash flow list. The menu maps for the IRR and NPV menus are shown in Figure 2. Table 5-3describes the items within these menus. The results shown in Table 5-4are based on the values entered in the cash flows as shown in Table 5-2.

Table 5-3 Analyzing Cash Flows

Item	Description
Inv. l%	Investment or discount rate. Enter the investment rate or discount rate for the cash
	flow followed by I. This rate must be entered in both the NPV and IRR
	menus.*
NetPV	Net Present Value. Shows the value of the cash flows at the time of the initial cash
	flow, discounting the future cash flows by the value set for Inv. I%.
NetFV	Net Future Value. Shows the value of the cash flows at the time of the last cash flow,
	discounting the earlier cash flows by the value set for Inv. I%.
NetUS	Net Uniform Series. Shows the per-period payment of a regular, periodic cash flow
	of equivalent present value to the cash flow list.
Payback	Payback. Shows the number of periods for the investment to return value.
Discounted Payback	Discounted Payback. Shows the number of periods required for the investment to
	return value if the cash flows are discounted using the value set in Inv. I%.

Total

#CF/Yr

IRR%

Safe I%*

MIRR*

The sum of all the cash flows, equivalent to NPV if Inv. I% is 0.

The number of cash flows per year. The default is 1.

Internal Rate of Return. This is the discount rate that returns a Net Present Value for the entered cash flows.

Safe Interest Rate. Enter the safe investment rate followed by I.

Modified Internal Rate of Return. Used primarily when there is more than one sign change in a series of cash flows to evaluate the overall profitability of an investment.

FMRR*	Financial Management Rate of Return. Used primarily when there is more than one
	sign change in a series of cash flows to evaluate the overall profitability of an
	investment.

*Does not apply to the HP 20b.

Cash Flows 41