# FM-22-05 - REVIEW OF CALCULATOR FUNCTIONS FOR THE TEXAS...

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REVIEW OF CALCULATOR FUNCTIONS FOR THE TEXAS INSTRUMENTS [email protected] Samuel Brovennan, University of Toronto This note presents a review of calculator financial functions for the Texas Instruments BA-35 calculator. A number of the examples used as illustrations are from the 3rd edition of the book Mathematics of Investment and Credit, by S. Broverman. A detailed guidebook for the operation of and functions available on the BA-35 can be found at the following internet site: http://education.ti.com/us/global!guides.html#finance . It will be assumed that you have available and have reviewed the appropriate guide book for the calculator that you are using. Financial functions will be reviewed in the order that the related concepts are covered in Chapters 1 to 8 of Mathematics of Investment and Credit. Some numerical values will be rounded off to fewer decimals than are actually displayed in the calculator display. It will be assumed that unless indicated otherwise, each new keystroke sequence starts with clear registers. Calculator registers are cleared with the keystroke IAc/oNI. ACCUMULA TED AND PRESENT VALUE OF A SINGLE PAYMENT USING A COMPOUND INTEREST RATE Accumulated values and present values of single payments using annual effective interest rates can be detennined using the calculator functions as described below. Accumulated Value: We use Example 1.1 to illustrate this function. A deposit of 1000 made at time 0 grows at annual effective interest rate 9%. The accumulated value at the end of 3 years is 1000(1.09)3 = 1,295.03. This can be found using the calculator in two ways:

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2 1. Calculator can be in any MODE. Key in I.0912nd[ 0, Key in 3[;] GJ , Key in 1000 [;]. The screen should display 1,295.029. In this function, y = 1.09 and x = 3. 2. Calculator in "Fin" MODE. Key in 1000jPV[, Key in 9BTI, Key in 3lliJ ICPTIIFVI. The screen should display 1,295.029. Present Value: We use Example I.5(a) to illustrate this function. The present value of 1,000,000 due in 25 years at effective annual rate .195 is 1,000, 000v25 = 1,000,000(l.195r25 = 11,635.96. This can be found using the calculator in two ways: 1. Calculator can be in any MODE. Key in 1.19512nd[ 0, Key in 251+/-1 [;] GJ, Key in 1000000. [;]. The screen should display 11,635.96 This keystroke sequence can be replaced by: Key in 1.195 12nd[ 11Ix[12nd[ 0, Key in 25 [;] GJ, Key in 1000000 [;] . 2. Calculator in "Fin" MODE. Key in 1000000 I FV I , Key in 19.5 BTI, Key in 25 lliJ ICPTllpvl, The screen should display 11,635.96. As a more general procedure, in the equation (PV)(l+i)N = FV, if any 3 of the 4 variables PV, i , N, FV are entered, then the 4th can be found using the ICPT[ function.
3 Unknown Interest Rate: As an example of solving for the interest rate, we consider Example 1.5(c).

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FM-22-05 - REVIEW OF CALCULATOR FUNCTIONS FOR THE TEXAS...

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