Question about Texas Instruments TI-84 Plus Calculator

I'm going to make up an example so this is easier to answer.

Ex: You have a bond with a price of $987, with a coupon of 1.5%, which matures in 10 years.

To do this problem:

[APPS] [1] [1]

What comes up on screen:

N=

I%=

PV=

PMT=

FV=

This is all the stuff that you really care about.

Now, add in the info you know from the equation. Put in a 0 if you don't know the number for that part.

This is what it should look like:

N=10

I%=0

PV=-987

PMT=15

FV=1000

Now, cursor back up to the I%=0 part.

Highlight the '0' that you had in there from before.

[ALPHA] [ENTER] ----> notice above the enter button it says in green lettering "solve", this is what you are trying to do.

Yay! Your caluculator has now figured out the interest rate!

it should say:

I%=1.642027191

Notes:

1. Make sure your payment is set at the end of the period (this is just the standard so you probably don't want to mess with it.) Scroll down to the PMT: END BEGIN part and make sure the END is highlighted.

2. This example used annual coupon payments. The p/y and c/y business is used for when you have semi-annual payments or semi-annual compounding (or daily, or hourly etc). You can use this feature, or you can just adjust the payment and periods

(ie: if this were a semi-annual coupon bond, the N would be 20 and the pmt would be 7.5)

Posted on Apr 30, 2009

Let's see, 10% interest per year on $100 for one month. That's 10/12 of a percent interest on $100 is $0.83, added to $100 is $100.83 (with a bunch more 3s at the end). Clearly this is the correct answer.

What answer are you expecting? The future value at the end of one year instead of one month?

What answer are you expecting? The future value at the end of one year instead of one month?

Nov 30, 2013 | Texas Instruments BA-II Plus Calculator

Error 5 indicates that no solution exists. In this particular case, you're asking for the interest rate on a savings account that pays you 10,000 now and an additional 20,000 10 years later. (Or a loan where you pay 10,000 now and an additional 20,000 10 years later.)

Either PV or FV should be negative. For example, if you deposit 10,000 in a savings account and withdraw 20,000 10 years later, use -10,000 for FV.

Either PV or FV should be negative. For example, if you deposit 10,000 in a savings account and withdraw 20,000 10 years later, use -10,000 for FV.

Aug 08, 2011 | Texas Instruments BA-II Plus Calculator

Neely Neel Neel Neelerson,

--> APPS

--> TVM

Viola. The initials TVM stand for Time-Value-Money; it's a widely used tool throughout financial mathematics. If you are looking to deal with annuities, bonds, present value equations, future value equations, or even certain stocks then you will want to use the TVM app within your TI-84.

When you go into that menu screen you will see about 10 input lines; and despite how you're being taught you'd be best off using only five (from a mathematical & conceptual standpoint). The backbone of the TVM is the time-zero equation of value. So, all you want to be touching is the N, I/Y, PV, PMT, and FV keys.

Background on TVM:

N = Number of intervals

I/Y = Effective Interest Rate Per Interval (5% is .05 but the computer wants it entered as 5.0)

PV = The Present Value

PMT = Recurring Payment (either deposit or withdrawal)

FV = Future Value

There are like 3 other inputs that I encourage you to ignore (in exchange for learning exactly what's going on within this application).

NOTE: You MUST make your effective interest term match your number of intervals. For example, an annuity with monthly payments for 5 years with a monthly effective interest rate of 2% would need an N value of 60 (which is 12 months per year times 5 years for a total of 60 months).

There's more that could be said, but I think this should help you find the PV of an annuity.

Go Bulls,

The Math Cheetah

411@themathcheetah.com

--> APPS

--> TVM

Viola. The initials TVM stand for Time-Value-Money; it's a widely used tool throughout financial mathematics. If you are looking to deal with annuities, bonds, present value equations, future value equations, or even certain stocks then you will want to use the TVM app within your TI-84.

When you go into that menu screen you will see about 10 input lines; and despite how you're being taught you'd be best off using only five (from a mathematical & conceptual standpoint). The backbone of the TVM is the time-zero equation of value. So, all you want to be touching is the N, I/Y, PV, PMT, and FV keys.

Background on TVM:

N = Number of intervals

I/Y = Effective Interest Rate Per Interval (5% is .05 but the computer wants it entered as 5.0)

PV = The Present Value

PMT = Recurring Payment (either deposit or withdrawal)

FV = Future Value

There are like 3 other inputs that I encourage you to ignore (in exchange for learning exactly what's going on within this application).

NOTE: You MUST make your effective interest term match your number of intervals. For example, an annuity with monthly payments for 5 years with a monthly effective interest rate of 2% would need an N value of 60 (which is 12 months per year times 5 years for a total of 60 months).

There's more that could be said, but I think this should help you find the PV of an annuity.

Go Bulls,

The Math Cheetah

411@themathcheetah.com

Mar 13, 2011 | Texas Instruments TI-84 Plus Calculator

2nd [CLR TVM] (clear TVM registers)

2 4 0 0 +/- PV ($2400 initial investment, negative because you're paying it out)

6 I/Y (6% annual interest)

1 N (one year)

CPT FV (compute future value, see 2544.00, the value after one year)

5 N (five years)

CPT FV (see 3211.74, the value after five years)

1 0 N (ten years)

CPT FV (see 4298.03, the value after ten years)

2 4 0 0 +/- PV ($2400 initial investment, negative because you're paying it out)

6 I/Y (6% annual interest)

1 N (one year)

CPT FV (compute future value, see 2544.00, the value after one year)

5 N (five years)

CPT FV (see 3211.74, the value after five years)

1 0 N (ten years)

CPT FV (see 4298.03, the value after ten years)

Feb 19, 2011 | Texas Instruments BA II PLUS Financial...

If the interest is compounded monthly:

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

25 2nd [*P/Y] N (25 years)

CPT FV (compute future value, see 66,974.55)

If the interest is compounded annually:

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

2nd [P/Y] 1 ENTER 2nd [QUIT] (one compounding period per year)

25 N (25 years)

CPT FV (compute future value, see 64,378.96)

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

25 2nd [*P/Y] N (25 years)

CPT FV (compute future value, see 66,974.55)

If the interest is compounded annually:

2nd [CLR TVM] (clear any existing results)

1 5 0 0 0 _/- PV (present value, negative because you're paying it out)

6 I/Y (annual interest rate)

2nd [P/Y] 1 ENTER 2nd [QUIT] (one compounding period per year)

25 N (25 years)

CPT FV (compute future value, see 64,378.96)

Oct 26, 2010 | Texas Instruments BA-II Plus Calculator

2nd [CLR TVM] (clear old data)

6 2 5 PV (present value)

8 I/Y (annual interest)

1 2 8 4 +/- FV (future value)

CPT N / 1 2 = (compute number of months, divide by 12 to get number of years)

6 2 5 PV (present value)

8 I/Y (annual interest)

1 2 8 4 +/- FV (future value)

CPT N / 1 2 = (compute number of months, divide by 12 to get number of years)

Oct 15, 2010 | Texas Instruments BA-II Plus Calculator

That depends on the interest rate.

2nd [CLR TVM] (clear previous data)

5 0 0 0 PMT (monthly payment)

2 0 2nd [*P/Y] N (20 years of monthly payments)

annual interest rate I/Y (annual interest rate)

CPT PV (compute present value)

At 10% it's about $518,000

2nd [CLR TVM] (clear previous data)

5 0 0 0 PMT (monthly payment)

2 0 2nd [*P/Y] N (20 years of monthly payments)

annual interest rate I/Y (annual interest rate)

CPT PV (compute present value)

At 10% it's about $518,000

May 26, 2010 | Texas Instruments BA-II Plus Calculator

Using the calculator at http://www.ecentralcu.org/futurevalue-pp.html I get $35,065.70

Payments = $21,600 + $13,465.70 in interest.

Payments = $21,600 + $13,465.70 in interest.

Aug 27, 2009 | HP 10bII Calculator

You have the payments-per-year set to 12. For this pair of problems, it needs to be set to 1.

Press 2nd [P/Y] 1 ENTER.

Press 2nd [P/Y] 1 ENTER.

Jun 24, 2008 | Texas Instruments BA-II Plus Calculator

Hmmm, I don't think the problem is with your calculator. I'd be checking the accounting question again as I don't think you've got your annuity question structured right.

4 Year Annuity

14% Annual Interest Rate

Your contributing $4,000 per year over the next 4 years

and you already know the future value is $50,069?

You'd have to make annual payments of $11,878.93 (4 of them) at that annual interest rate to get to a future value of $50,069 (which has a present value of $43,632.24).

Are you sure that the FV isn't the trade in value at the end of the 4 years?

4 Year Annuity

14% Annual Interest Rate

Your contributing $4,000 per year over the next 4 years

and you already know the future value is $50,069?

You'd have to make annual payments of $11,878.93 (4 of them) at that annual interest rate to get to a future value of $50,069 (which has a present value of $43,632.24).

Are you sure that the FV isn't the trade in value at the end of the 4 years?

Oct 05, 2007 | Sharp SHREL738 Calculator

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p/y is payments per year and c/y is compounding periods in the year. If you are NOT making monthly payments [where p/y would be 12] to an account or loan then p/y and c/y are the same. So, go by the compounding in the question --- Monthly [12], semi-monthly [24], bi-weekly [26], etc...

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