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HP F1902-90001 manual $PruwlhWkhVhfrqg\Hdu, ’LVSOD\V35,1DQGWKH, 6HWVSD\PHQWVSHU\HDU

Models: F1902-90001

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70 5: Time Value of Money Calculations

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$HP F1902-90001 manual $PruwlhWkhVhfrqg\Hdu, ’LVSOD\V35,1DQGWKH, 6HWVSD\PHQWVSHU\HDU$

Contents

Hp 10BII financial calculator Edition HP part number F1902-90001Edition May ZRUOGZLGHVHUYLFH Welcome to the HP 10BIIHewlett-Packard Quality FDOFXODWRUVFKHGXOHV Features$ODUJHFKDUDFWHUGLVSOD\ FDOFXODWLRQVContents 33 3HUFHQW.H\ 73 &RPSRXQGLQJDQG3D\PHQW3HULRGV’LIIHU 53 8VLQJWKH790$SSOLFDWLRQ54 &OHDULQJ790 84 $XWRPDWLF6WRUDJHRI,555DQG139101 $QQXDO3HUFHQWDJH5DWHIRUD/RDQLWKHHV 123 &RQVXPHU7UDQVDFWLRQVLQWKH8QLWHG.LQJGRPQWHULQJD*XHVVIRU,555 129 ,555&DOFXODWLRQV130 +DOWLQJDQG5HVWDUWLQJ,555 132 7LPH9DOXHRI0RQH\790Page FRQFHSWVSUHVHQWHGLQWKLVVHFWLRQ At a GlanceBasics-At a Glance 7XUQVFDOFXODWRURQRVW 3ULFH Percentages-At a Glance7D 3HUFHQW $GGWR6WRUHV·ïµDVD Memory Keys-At a Glance…6WRUHVDFRQVWDQWRSHUDWLRQ OHDUVGLVSOD\1XPEHURISD\PHQWVSHU\HDUPRGH Time Value of Money TVM-At a Glance…3D\PHQW 6HWVSD\PHQWVSHU\HDUFDQERUURZ TVM What if…-At a Glance…DOFXODWHVDPRXQW\RX +RZPXFKFDQ\RXERUURZDWDLQWHUHVWUDWH’LVSOD\VSULQFLSDO Amortization-At a Glance…DQGBALDQQXQFLDWRUVUHVSHFWLYHO\ ’LVSOD\VEDODQFH3HULRGVSHU\HDU Interest Rate Conversion-At a Glance…WKHQVROYHIRUWKHXQNQRZQUDWH FRPSRXQGHGPRQWKO\QWHUVQXPEHURIFRQVHF IRR/YR and NPV-At a Glance…1HWSUHVHQWYDOXH QWHUV ,5Statistics-At a Glance… OHDUVWDWLVWLFDOUHJLVWHUV55.68 10.00 27.50 420.00 Keyboard Map Key memory Backspace Accumulate statistical data Cash flowsPage Getting Started Power On and OffAdjusting the Display Contrast Simple Arithmetic CalculationsKDQJHVWKHVLJQRI DOFXODWHVUHVXOWClearing the Calculator Understanding the Display and KeyboardCursor Clearing MemoryAnnunciators 26 1 Getting StartedEHHQSHUIRUPHG Shift KeyStatistics Key DJDLQSwap Key Math FunctionsInput Key $GGVDQGDOFXODWHVWKHSHUFHQW Display Format of NumbersQWHUV QXPEHU FKDQJHDIWHUWKHGHFLPDOSRLQW Specifying Displayed Decimal PlacesScientific Notation SODFHVGHFLPDOSRLQWLVQRWVKRZQ Displaying the Full Precision of NumbersInterchanging the Period and Comma ’LYLGHVMessages Rounding NumbersPercent Key Business PercentagesFinding a Percent Adding or Subtracting a Percent Percent ChangeMarkup on Cost Calculations Margin and Markup CalculationsMargin Calculations GLVSOD\HGDOFXODWHVWKHSULFHRQ Using Margin and Markup Together6WRUHVPDUNXS FDVHRIVRXSNumber Storage and Arithmetic Using Stored Numbers in CalculationsUsing Constants RSHUDWLRQVFRQVWDQW VWDQW5HFDOOVFRQWHQWVRIWKH Using the M RegisterUHJLVWHU UHJLVWHU5HFDOOV5 Using Numbered RegistersIROORZLQJ RPSOHWHVILUVWDQGVWRUHVUHVXOW Doing Arithmetic Inside Registers0XOWLSOLHVLQ5 E\ LQ5 Doing Arithmetic FDOFXODWH Power OperatorUsing Parentheses in Calculations ⋅ 0XOWLSOLHVWKHUHVXOWE\ DOFXODWHV†DOFXODWHV 1RFDOFXODWLRQ\HWPicturing Financial Problems Picturing Financial ProblemsHow to approach a Financial Problem WRVROYLQJDILQDQFLDOSUREOHPDERXWWKHWUDQVDFWLRQ 46 4 Picturing Financial ProblemsSigns of Cash Flows 000.00Simple Interest Periods and Cash FlowsSimple and Compound Interest NQRZQEHIRUH\RXFDQEHJLQFDOFXODWLQJDUHEDVHGRQFRPSRXQGLQWHUHVW 48 4 Picturing Financial ProblemsCompound Interest 005.00 010.03 015.08 020.16 025.26Recognizing a TVM Problem Two Types of Financial ProblemsInterest Rates 357 358 359 PV = 150,000.00= 360 30 PMT = -1,041.40 FV = -10,000.00Recognizing a Cash Flow Problem 000.00Page 7RXVH790VHYHUDOSUHUHTXLVLWHVPXVWEHPHW Using the TVM ApplicationTime Value of Money Calculations 3D\PHQWVPXVWRFFXUDWUHJXODULQWHUYDOVRFFXUVDWWKHEHJLQQLQJRIWKHILUVWSHULRG Clearing TVMDOFXODWHVDQDPRUWLDWLRQWDEOH RFFXUDWWKHEHJLQQLQJRUHQGRIHDFKSHULRGBegin and End Modes Loan Calculations6WRUHVWKHDPRXQWOHIW 6WRUHVDPRXQWERUURZHG WRSD\DIWHU\HDUV6HWVSHULRGVSHU\HDU PV = ? YR = 7.5% = 30 356 357 358 359 360 PMT = End ModeSXUFKDVHSULFH 6WRUHVLQWHUHVWUDWHDIWHU\HDUV 6ROYHWKLVSUREOHPXVLQJWZRVWHSV6WRUHVORDQEDODQFH 6WRUHVRULJLQDOORDQWKHQVWRUHV PV = 172,500.00 YR = 8.8% = 4ILUVWGHSRVLW Savings CalculationsOHDUVDOOUHJLVWHUV WRDFFXPXODWHYR = FV= ? YR = 6.3%PMT = PV = -2,000.00 6WRUHVQXPEHURI FV = YR = 7% = 600 50 PV = -400,000.00 Begin ModeSHU\HDU GHSRVLWVWZRFRPPRQOHDVHFDOFXODWLRQV Lease CalculationsZLWKGUDZDOV WKHEHJLQQLQJRIHDFKYDOXH FV = 7,500.00 PMT = ? YR = 10% PV = -13,500.00 Begin Mode\LHOG LQPRQWKV7KLVVROXWLRQUHTXLUHVIRXUVWHSV Begin Mode PV = ?PMT = -2,400.00 48th payment due up front FV = -15,000.00 YDOXHRIPRQWKO\ SD\PHQWVDOFXODWHVSUHVHQW $GGVDGGLWLRQDOPayment $ AmortizationPrincipal $ Interest $ Time \WKHVWDUWLQJDQGHQGLQJSD\PHQWVWKDWZLOOEHDPRUWLHG WKHVDPHYDOXHVDJDLQDQGEDODQFH 68 5 Time Value of Money Calculations178,420.18’LVSOD\VWKH%$/ 579.82’LVSOD\VWKH35,113,894.66’LVSOD\VWKH,17 HQGLQJSHULRGV6HWVSD\PHQWVSHU\HDU $PRUWLHWKHVHFRQG\HDU’LVSOD\V35,1DQGWKH 70 5 Time Value of Money CalculationsSULQFLSDOSD\PHQW ’LVSOD\V,17DQGWKHLQWHU HVWSHULRGGLIIHU Interest Rate ConversionsInvestments With Different Compounding Periods IDYRUDEOHLQWHUHVWUDWH6WRUHVQRPLQDOUDWH 6WRUHVPRQWKO\FRP SRXQGLQJSHULRGV Compounding and Payment Periods Differ6WRUHVQRPLQDOUDWH 6WRUHVTXDUWHUO\ FRPSRXQGLQJSHULRGV 6WRUHVQRPLQDOUDWH6WRUHVWRWDOQXPEHURI Step . &DOFXODWHWKHIXWXUHYD XH6WRUHVSD\PHQW DOFXODWHVEDODQFHDIWHUWKH+3%,, How to Use the Cash Flow ApplicationCash Flow Calculations QWHUWKHQXPEHURISHULRGVSHU\HDUQRPLQDO\LHOG QWHUVQHWFDVKIORZQWHUVILQDOFDVKIORZ 0RQWKO\\LHOGNPV and IRR/YR Discontinuing Cash Flows Organizing Cash FlowsEHHQHQWHUHG Entering Cash FlowsIORZVXVLQJWKHIROORZLQJVWHSV 3UHVV*&WRFOHDUWKHUHVLVWHUVIORZJURXSDPRXQW QWHUVQXPEHURI UHSHWLWLRQV Viewing and Replacing Cash FlowsJURXSDPRXQW QWHUVQXPEHURI UHSHWLWLRQV 7RYLHZDFDVKIORZSUHVV7KHVHVWHSVGHVFULEHKRZWRFDOFXODWH139 Calculating Net Present Value7RUHSODFHDFDVKIORZDPRXQWSUHVV QWHUVQXPEHURI RFFXUUHQFHV OHDUVUHJLVWHUVYR = 15% 10,000 500 FDOFXODWHWKHQHWSUHVHQWYDOXH 82 6 Cash Flow CalculationsSUHYLRXVHDPSOH Calculating Internal Rate of Return 3UHVV*9 000 10,000 500 28,000 11 13 15 17 IRR/YR = ? 19 21 23Automatic Storage of IRR/YR and NPV 84 6 Cash Flow CalculationsHLJKWHGPHDQ Statistical CalculationsClearing Statistical Data Statistical CalculationsOne-Variable Statistics Two-Variable Statistics and Weighted MeanEntering Statistical Data VWDWLVWLFDOUHJLVWHUVCorrecting One-Variable Data Correcting Statistical DataSummary of Statistical Calculations Correcting Two-Variable Data6XPRIWKH\YDOXHV LI\RXHQWHUHG\GDWD6XPRIWKHYDOXHV 88 7 Statistical CalculationsVTXDUH DOFXODWHVWKHURRWPHDQIROORZV Linear Regression and Estimation82.75 ’LVSOD\VPHDQRIZHLJKWV\ 90 7 Statistical Calculations PLQXWHVRIDGYHUWLVLQJ 357.38VWLPDWHVVDOHVLI ’LVSOD\VVORSHFRHIILFLHQW 783.25VWLPDWHVVDOHVLIWeighted Mean Page Business Applications Setting a Sales PriceAdditional Examples SURGXFWVWLPDWHVVDOHVIRU\HDU Forecasting Based on HistoryVHYHQ OHDUVVWDWLVWLFVUHJLVWHUVCost of Not Taking a Cash Discount Continuous Compounding Loans and MortgagesSimple Annual Interest 17567Yield of a Discounted or Premium Mortgage DIWHU\HDUV PRUWJDJHQWHUVDPRXQWOHIWWRSD\ DOFXODWHVUHJXODUAnnual Percentage Rate for a Loan With Fees LQWHUHVWD HPDGH 72&DOFXODWHV$35FRQVLGHULQJIHHV GXHLoan With a Partial Odd First Period GHDOHULVRIIHULQJWZRFKRLFHVIRUILQDQFLQJ Automobile LoanDPRXQW UHEDWH LWKZKLFKFKRLFHGR\RXSD\OHVVIRUWKHFDUCanadian Mortgages IROORZV What if … TVM Calculations106 8 Additional Examples ELZHHNO\SD\PHQWV LQWHUHVWSDLGRQWKHFRQWUDFWWRSD\RIIORDQ 6WRUHVQHZWHUP$15,000 YR = 9% SavingsSaving for College Costs YearPrevious 6WRUHVDQQXDO ZLWKGUDZDO 6WRUHVQXPEHURI ZLWKGUDZDOVFV from 142 143 144 PMT = ?VWDUWLQJZLWK Gains That Go Untaxed Until WithdrawalQHHG 110 8 Additional ExamplesRILQWHUHVW VWDUWZLWK 6WRUHVDPRXQWRI DQQXDOSD\PHQWUHWLUHPHQW LQIODWLRQUDWH6WRUHVDPRXQW\RXDUH Value of a Taxable Retirement AccountVWDUWLQJZLWK 6WRUHVDPRXQWRI DQQXDOSD\PHQW DFFRXQWDWUHWLUHPHQWCash Flow Examples Wrap-Around MortgagesQHWPRQWKV KHQ\RXJURXSWKHDERYHFDVKIORZV\RXOOILQGWKDWQWHUVQHWSD\PHQWIRU WLPHVSD\PHQWRFFXUVJURXS Net Future ValueFXUUHQWEDODQFHRIWKHDFFRXQW JURXSYDOXH139 116 8 Additional ExamplesAnswers to Common Questions Assistance, Batteries, and ServiceAssistance, Batteries, and Service 3UHVV*SDJH KDWGRHVPENDLQWKHGLVSOD\PHDQ Environmental LimitsKDWGRHVDQ·µLQDQXPEHUIRUHDPSOH†PHDQ 6WRUDJHWHPSHUDWXUH†ƒWRƒ&†ƒWRƒBattery Specifications Power and BatteriesLow Power Annunciator Installing Batteries 5HPRYHERWKEDWWHULHV VHFWLRQ HUDVHWKHPHPRU\VHHEHORZ Determining if the Calculator Requires ServiceQVWDOOQHZEDWWHULHV FDVHWKHFDOFXODWRUUHTXLUHVDVHUYLFHWhat Is Not Covered Limited One-Year WarrantyWhat Is Covered EDWWHU\DQGEDWWHU\OHDNDJHZDUUDQWLHVConsumer Transactions in the United Kingdom If the Calculator Requires ServiceObtaining Service XSGDWHSURGXFWVRQFHVROGWarranty on Service Service ChargeShipping Instructions Regulatory Information Service AgreementsRSHUDWHWKLVHTXLSPHQW End-user terms and conditions Assistance, Batteries, and Service Page Possible Outcomes of Calculating IRR/YR More About CalculationsIRR/YR Calculations KHOS\RXLQWHUSUHWZKDWKDVKDSSHQHGRQHQHJDWLYHFDVKIORZ Halting and Restarting IRR/YRTering a Guess for IRR/YR $IWHU\RXYHLQWHUUXSWHGWKHFDOFXODWLRQIROORZLQJWKLVDSSHQGL Effect of Using Σ- to Correct DataRange of Numbers WRFOHDUWKHVWDWLVWLFDOUHJLVWHUVDQGUHHQWHUWKHGDWDTime Value of Money TVM EquationsMargin and Markup Calculations AmortizationInterest Rate Conversions RUHDFKSD\PHQWDPRUWLHG Cash-Flow CalculationsWKHJURXSQXPEHURIWKHODVWJURXSRIFDVKIORZV Statistics Σx =Page RS\ULJKWPHVVDJH Messages0HPRU\KDVEHHQHUDVHGSDJH FRQGLWLRQ5XQQLQJ$FDOFXODWLRQLVLQSURFHVV UfloIndex Special KeysUhsodflqj Xqhyhq Ylhzlqj HJLQPRGH RUURZLQJHTXLW\ \RXWYDOXH Gldjudpv Glvfrxqw Hqwhulqj Htxdwlrqv KDLQFDOFXODWLRQV Rjdulwkp Uhvwduwlqj LQHDUUHJUHVVLRQ , Zhljkwhg , 0HPRU\5DWH Hiihfwlyh , DWDJODQFH 3HUFHQW DULWKPHWLFLQ Qxpehuhg Uhjlvwhuv 6LJQFKDQJLQJ Hvwlpdwlrq Vxppdwlrq

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