math chapter 13 ravi Flashcards
what is J?
the anual interest rate (also called nominal rate) NOM%
what is J on the calculator?
NOM%
what is N
time period
what is PV
present value (amount of money today)
what is PMT
payment
what is FV
Final Value (amount of money at the end)
p/yr?
compounding periods per year
how do you set up your calculator to one decimal point
- red down key
- = sign
- decimal sign
on calculator, if you press..
red arrow down/decimal/3
what happens?
it will go 3 decimal points (numbers)
how would you push 13% into the calculator
- 13
- red arrow down (this means second function)
- NOM (wich is on the i/yr button)
how would you put in
payment of $250
vs
receiving $250
payment
- 250
- (press the +/- button)
- PMT
receiving
- 250
- PMT
what does p/yr mean
compounding periods per year
how would you enter daily/weekly/monthly/quarterly in compounding periods per year on the calculator?
365 down arrow (second function) PMT(second function = p/yr)
52
down arrow
p/yr
etc
how to clear the calculator including memory from previous question
- red down arrow
2. C (clear)
whaat does RCL mean on the calculator
it means recall, so for example, you can press RCL and then N and see the time period for the previous calculation
after doing the compounding periods/year and the interest rate
what is the order you should do on the calculation
go from left to right
so start with the N (period of time) and move towards FV
How do you calculate per annum?
Divide the annual interest amount by 12 to calculate the amount of your per annum interest payment that is due each month. If you owe $600 for the year, you make monthly payments of $50. Another way to make the same calculation is to divide the annual interest rate by 12 to calculate the monthly rate.
anytime money is going out of your pocket you must put it as _____ in the calculator?
negative (-)
on an interest accruing loan how much money do you pay per month
$0
difference between interest only loan and interest acruing loan?
interest only, means every coupounding period you are paying the interest rate back to the lender
with interest accruing, the borower does not pay the interest back until the final payment when he/she pays back the principal
accruing loan is for 8 months
if it is J12
and N = 8 months
what is the P/YR?
12!! dont be confused by the 8 months
-Get a loan of $300,000
-and getting a further loan of 2,000 per month
-how much to return after 5 years
j12= 10%
J12 = 10% N = 5 years (60 months)
PV————-pmt————FV
$300,000–2,000———?
FV = - $648,466.82
Minus means to be given to lender after 5 years answer the question will be 493,592.68 will need to be returned
Get a loan of $300,000
How much to return after 5 years
J12 = 10%
N = 5 years (60 months)
J12 = 10% N = 5 years (60 months)
PV——————-pmt—————FV
$300,000———0——————-?
FV = - $493,592.68
Minus means to be given to lender after 5 years answer the question will be 493,592.68 will need to be returned
-Get a loan of $300,000
-making a payment of 2,000 per month
-how much to return after 5 years
J12 = 10%
J12 = 10% N = 5 years (60 months)
PV——————-pmt———–FV
$300,000——–(-2,000)——-?
FV = - $338,718.54
Minus means to be given to lender after 5 years answer the question will be 338,718.54 will need to be returned