NeoCal User Guide
Time Value of Money
This application can calculate any single value of the
,
,
,
, and
registers based on the values
of the other four registers. This is useful for compound interest
calculations involving regular, uniform payments such as loans,
mortgages, leases, and annuities. There must be at least one
negative and one positive cash flow (
,
, and/or
). In addition,
- The value stored in the
register is used to
convert the annual nominal rate (
) to the periodic
rate (which is required for the calculations).
-
stores the displayed number multiplied by the
value in the
register into the
register.
-
divides the displayed value by the value in
the
register.
-
switches between begin and end
modes and is used to specify whether the payments occur at the
beginning or the end of the period. When begin mode is
selected, the BEGIN indicator is displayed, otherwise
end mode is in effect.
For an example, let's consider a car loan. What would the payments
be for a three-year loan of $16,500 with an APR of 9.5 percent?
- If the calculator is in begin mode, press
to set end mode.
- Press
to clear the financial registers.
- Press
for monthly payments.
- Press
to store the annual effective rate.
- Press
to calculate the annual nominal rate of
9.11 percent (which is stored in the
register).
- Press
to store 36 in
the
register for the total number of payments.
- Press
to store amount to be financed.
- Press
to calculate -525.54 as the monthly
payment amount. By convention, positive amounts designate money you
receive and negative amounts designate money you pay.
As a comparison, let's calculate the payment for a four-year loan:
- Press
to store 48 for
the total number of payments.
- Press
to calculate -411.46 as the monthly
payment amount.