Time Value of Money
Self-Paced Overview
Using a Financial Calculator
Example 2:
How much would you have in four years if you deposit $40,000 at the beginning of each year for four years and interest is 10% compounded annually?
Using an HP 10bII+
Read the problem thoroughly.
Remember cash outflows carry a minus sign.
Make sure what is being asked in the problem.
What is the future value of a $40,000 four-year annuity due?
Clear the calculator.
Input the known value.
Input the number of compounding periods per year.
Input the annual interest rate.
Input the total number of compounding periods.
Request the unknown.
Answer: $204,204.00