StudyFinance

StudyFinance

Time Value of Money Solution Grid

 Self-Paced Overview

Using the Solution Grid

Problem:

If you borrow $35,000 and make 10 annual payments at 4% interest, how much will those payments be?

The solution grid:

P/YR
1
N I/YR PV PMT FV
10 4 35,000 ? 0

The answer is:  $4,315.18

The calculator keystrokes:

C
  C ALL
1    P/YR
1  0  N
4  I/YR
3  5  0  0  0  PV
0  FV
PMT
CE/C
2nd CLR TVM
2nd P/Y  1  ENTER  2nd QUIT
1  0  N
4  I/Y
3  5  0  0  0  PV
0  FV
CPT  PMT

Again, the answer is displayed as a negative value since the annual payments represent cash outflow.

StudyFinance.com is maintained by Dr. Sharon Garrison
Terms of Use • Privacy • Copyright © 1999–2018 StudyFinance.com