#HP 12C FINANCIAL CALCULATOR TVM HOW TO#
#HP 12C FINANCIAL CALCULATOR TVM FREE#

Suppose that you are planning to send your daughter to college in 18 years.

Keep that in mind because it can help you to spot incorrect answers due to a wrong input. One important thing to remember is that the present value will always (unless the interest rate is negative) be less than the future value. Solving for the present value of a lump sum is nearly identical to solving for the future value. For example, suppose that we wanted to find out the future value if we left the money invested for 10 years instead of 5.

We can change any of the variables in this problem without needing to re-enter all of the data.

Do not change the sign of a number using - (the 'minus' key). This would be correct had you borrowed $100 today (cash inflow) and agreed to repay $161.05 (cash outflow) in five years. Had you entered the $100 as a positive number no harm would have been done, but the answer would have been returned as a negative number. In this problem, the $100 was an investment (i.e., a cash outflow) and the future value of $161.05 would be a cash inflow in five years. Cash inflows are entered as positive numbers and cash outflows are entered as negative numbers. This is simply a way of keeping the direction of the cash flow straight. Most financial calculators (and spreadsheets) follow the Cash Flow Sign Convention.

Notice that we entered the 100 in the PV key as a negative number.

Had you entered 0.10, the future value would have come out to 100.501 - obviously incorrect. This is because the calculator automatically divides any number entered into i by 100.

When we entered the interest rate, we input 10 rather than 0.10.

The order in which the numbers are entered does not matter.

To solve these problems you simply enter the variables that you know in the appropriate keys and then press the other key to get the answer. In this case, we have a 4-variable problem and were given 3 of them (N, i, and PV) and had to solve for the 4th (FV). Of these, you will always be given 3 or 4 and asked to solve for the other.

Every time value of money problem has either 4 or 5 variables (corresponding to the 5 basic financial keys).

Now to find the future value simply press the FV key. Now all we need to do is enter the numbers into the appropriate keys: 5 into N, 10 into i, -100 into PV. Press f X> hp 12c financial calculator tvm

Otherwise, you may find that numbers left over from previous problems will interfere with the solution to this one. Before entering the data you need to make sure that the financial registers (each key is nothing more than a memory register) are cleared. In this problem, the $100 is the present value (PV), N is 5, and i is 10%. How much will you have accumulated at the end of this time period? Suppose that you have $100 to invest for a period of 5 years at an interest rate of 10% per year. We'll begin with a very simple problem that will provide you with most of the skills to perform financial math on the 12C: If the answer isn't there, drop me a note and maybe I'll know the answer. If you have questions about the 12C, please check the FAQ. That's it, the calculator is ready to go. I would press f 5 to display 5 decimal places. To change the display, press f and then the number of decimal places you wish to display. Personally, I like to see five decimal places, but you may prefer some other number. By default the 12C displays only two decimal places. One adjustment is important before we get started. It takes some time to get used to initially, but it is worth it in the long run. I still recommend that you use the RPN mode. They are almost identical, but the 12C Platinum is faster and allows you to use algebraic data entry like most other calculators. Please note that there are two versions of the HP 12C: The original one (in the picture), and the newer 12C Platinum. I will make no effort here to teach RPN as it isn't necessary for our purposes. I will keep the examples rather elementary, but understanding the basics is all that is necessary to learn the calculator.

#HP 12C FINANCIAL CALCULATOR TVM HOW TO#

This tutorial will demonstrate how to use the financial functions to handle time value of money problems and make financial math easy. Actually, its very easy if you already know RPN (reverse polish notation - a much better way to enter data into a calculator than the algebraic method that you are probably familiar with). The HP 12C is a fairly easy to use financial calculator that will serve you well in all finance courses.

#HP 12C FINANCIAL CALCULATOR TVM FREE#

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Hp 12c financial calculator tvm