HP 12c Owners Manual
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Section 3: Basic Financial Functions 51 File name: hp 12c_users guide_English_HDPMBF12E44 Page: 51 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm You can calculate i, PV, PMT, and FV for transactions involving an odd period simply by entering a noninteger n. (A noninteger is a number with at least one nonzero digit to the right of the decimal point.) This places the calculator in Odd-Period mode. * The integer part of n (the part to the left of the decimal point)...
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52 Section 3: Basic Financial Functions File name: hp 12c_users guide_English_HDPMBF12E44 Page: 52 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm Example 1: A 36-month loan for $4,500 accrues interest at a 15% annual percentage rate (APR), with the payments made at the end of each month. If interest begins accruing on this loan on February 15, 2004 (so that the first period begins on March 1, 2004), calculate the monthly payment, with the odd days counted on the basis of a...
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Section 3: Basic Financial Functions 53 File name: hp 12c_users guide_English_HDPMBF12E44 Page: 53 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm Example 2: A 42-month car loan for $3,950 began accruing interest on July 19, 2004, so that the first period began on August 1, 2004. Payments of $120 are made at the end of each month. Calculate the annual percentage rate (APR), using the actual number of odd days and simple interest for the odd period. Keystrokes Display...
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54 Section 3: Basic Financial Functions File name: hp 12c_users guide_English_HDPMBF12E44 Page: 54 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm Amortization The hp 12c enables you to calculate the amounts applied toward principal and toward interest from a single loan payment or from several payments, and also tells you the remaining balance of the loan after the payments are made. * To obtain an amortization schedule: 1. Press fCLEARG to clear the financial registers....
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Section 3: Basic Financial Functions 55 File name: hp 12c_users guide_English_HDPMBF12E44 Page: 55 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm Keystrokes Display 573.35ÞP –573.35 Enters PMT (with minus sign for cash paid out). g –573.35 Sets payment mode to End. 12f! –6,608.89Portion of first year’s payments (12 months) applied to interest. ~ –271.31 Portion of first year’s payments applied to principal. :$ 49,728.69Balance remaining after 1 year. :n 12.00...
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56 Section 3: Basic Financial Functions File name: hp 12c_users guide_English_HDPMBF12E44 Page: 56 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm Keystrokes Display 1f! –552.08 Portion of first payment applied to interest. ~ –21.27 Portion of first payment applied to principal. 1f! –551.85 Portion of second payment applied to interest. ~ –21.50 Portion of second payment applied to principal. :n 2.00 Total number of payments amortized. If you want to generate...
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57 File name: hp 12c_users guide_English_HDPMBF12E44 Page: 57 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm Section 4 Additional Financial Functions Discounted Cash Flow Analysis: NPV and IRR The hp 12c provides functions for the two most widely-used methods of discounted cash flow analysis: l (net present value) and L (internal rate of return). These functions enable you to analyze financial problems involving cash flows (money paid out or received) occurring at...
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58 Section 4: Additional Financial Functions File name: hp 12c_users guide_English_HDPMBF12E44 Page: 58 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm z If NPV is positive, the financial value of the investor’s assets would be increased: the investment is financially attractive. z If NPV is zero, the financial value of the investor’s assets would not change: the investor is indifferent toward the investment. z If NPV is negative, the financial value of the investor’s...
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Section 4: Additional Financial Functions 59 File name: hp 12c_users guide_English_HDPMBF12E44 Page: 59 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm The amounts of the subsequent cash flows are stored – in the order they occur – in the remaining storage registers: CF 1 thru CF9 in R1 thru R9, and CF10 thru CF19 in R.0 thru R .9, respectively. If there is a CF20, that amount is stored in the FV register.* Each cash flow (CF 1, CF2, etc.) is designated CFj, where j takes...
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60 Section 4: Additional Financial Functions File name: hp 12c_users guide_English_HDPMBF12E44 Page: 60 of 209 Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm Example: An investor has an opportunity to buy a duplex for $80,000 and would like a return of at least 13%. He expects to keep the duplex 5 years and then sell it for $130,000; and he anticipates the cash flows shown in the diagram below. Calculate NPV to determine whether the investment would result in a return or a loss....