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HP 12c Owners Manual

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Page 41

  Section 3: Basic Financial Functions  41 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 41 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Keystrokes Display  
12z 
27.33 Twenty-seven years and four months. 
Because the calculator rounds the calculated value of n up to the next higher 
integer, in the preceding example it is likely that — while 328 payments will be 
required to pay off the loan — only 327 full payments of $325 will be required, 
the next and final...

Page 42

42  Section 3: Basic Financial Functions 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 42 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Example 2:
 You’re opening a savings account today (the middle of the month) 
with a $775 deposit. The account pays 61/4% interest compounded semimonthly. 
If you make semimonthly deposits of $50 beginning next month, how long will it 
take for your account to reach $4000?
 
 
Keystrokes Display  
fCLEARG 
6.25\24z¼ 
 
0.26...

Page 43

  Section 3: Basic Financial Functions  43 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 43 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Keystrokes Display  
MM 
4,027.27 Calculates FV – which equals the 
balance in the account if 58 full 
deposits were made.
* 
:P 
–50.00 Recalls amount of deposits. 
+ 
3,977.27 Calculates the balance in the account 
if 57 full deposits were made and 
interest accrued during the 58
th 
month.† 
4000- 
–22.73 Calculates final,...

Page 44

44  Section 3: Basic Financial Functions 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 44 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Example: 
What annual interest rate must be obtained to accumulate $10,000 in 
8 years on an investment of $6,000 with quarterly compounding? 
 
Keystrokes   Display   
fCLEARG 
8\4§w 
 
32.00  
Calculates and stores n. 
6000Þ$ 
–6,000.00Stores PV (with minus sign for cash 
paid out). 
10000M 
10,000.00Stores FV. 
¼ 
1.61 Periodic...

Page 45

  Section 3: Basic Financial Functions  45 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 45 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Example 1: 
You’re financing a new car purchase with a loan from an institution 
that requires 15% interest compounded monthly over the 4-year term of the loan. If 
you can make payments of $150 at the end of each month and your down 
payment will be $1,500, what is the maximum price you can pay for the car?
 
(Assume the purchase...

Page 46

46  Section 3: Basic Financial Functions 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 46 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Keystrokes Display  
fCLEARG 
5n 
 
5.00  
Stores n. 
12¼ 
12.00 Stores i. 
17500P 
17,500.00 Stores PMT. Unlike in the previous 
problem, here PMT is positive 
since it represents cash received. 
540000M 
540,000.00 Stores FV. 
g 
540,000.00 Sets payment mode to End. 
$ 
–369,494.09 The maximum purchase price to 
provide a 12%...

Page 47

  Section 3: Basic Financial Functions  47 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 47 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Keystrokes Display  
fCLEARG 
29gA 
 
348.00  
Calculates and stores n. 
14.25gC 
1.19 Calculates and stores i. 
43400$ 
43,400.00 Stores PV. 
g 
43,400.00 Sets payment mode to End. 
P 
–523.99 Monthly payment (with minus sign 
for cash paid out).   
Example 2:
 Looking forward to retirement, you wish to accumulate $60,000 
after...

Page 48

48  Section 3: Basic Financial Functions 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 48 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Calculating the Future Value 
1. Press fCLEARG to clear the financial registers. 
2.  Enter the number of payments or periods, using n or A. 
3.  Enter the periodic interest rate, using ¼ or C. 
4.  Enter either or both of the following: 
z Present value, using $. 
z Payment amount, using P.  Note: 
Remember to 
observe the cash flow...

Page 49

  Section 3: Basic Financial Functions  49 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 49 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Example 2:
 If you deposit $50 a month (at the beginning of each month) into a 
new account that pays 61/4% annual interest compounded monthly, how much will 
you have in the account after 2 years?
 
 
Keystrokes Display  
fCLEARG 
2gA 
 
24.00  
Calculates and stores n. 
6.25gC 
0.52 Calculates and stores i. 
50ÞP 
–50.00 Stores...

Page 50

50  Section 3: Basic Financial Functions 
 
File name: hp 12c_users guide_English_HDPMBF12E44  Page: 50 of 209   
Printered Date: 2005/7/29    Dimension: 14.8 cm x 21 cm 
 
Keystrokes Display  
2Þ¼ 
–2.00 Stores i (with minus sign for a 
“negative interest rate”). 
32000Þ $ 
–32,000.00 Stores PV (with minus sign for cash 
paid out). 
M 
28,346.96 Property value after 6 years. 
Odd-Period Calculations 
The cash flow diagrams and examples presented so far have dealt with financial 
transactions in which...
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