Sharp EL-738 operation manual 2000, 1000000, 376889

4 Calculating present value

You open an account that earns 5% compounded annually. If you wish to have $10,000 twenty years from now, what amount of money should you deposit now?

FV = $10,000

			N = 20 years
PV = ?		I/Y = 5%
	Procedure	Key operation	Display
Set all the variables to		.b	000
default values.

Make sure ordinary annuity is set (BGN is not displayed).

Set the number of pay- ments per year to 1.

.w1 Q

P/Y=

100

The number of compounding periods per year is automatically set to 1. Press sto exit the P/Y and C/Y settings.

Enter the total number	s20 N	2—~N
of payments.
		2000
Enter the future value.	10000 T	1————~FV
		1000000
Set payment to zero.	0 u	—~PMT
		000
Enter the annual inter-	5 f	5~I/Y
est rate.		500
Calculate the present	@v	PV=
value.		-376889

Answer: You should deposit $3,768.89 now.

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