Miscellaneous Programs And Equations; Time Value Of Money - HP 35s User Manual

Miscellaneous Programs and Equations

Time Value of Money

Given any four of the five values in the "Time–Value–of–Money equation" (TVM),
you can solve for the fifth value. This equation is useful in a wide variety of financial
applications such as consumer and home loans and savings accounts.
The TVM equation is:
P
B a lan ce, B
1
The signs of the cash values (balance, B; payment, P; and future balance, F)
correspond to the direction of the cash flow. Money that you receive has a positive
sign while money that you pay has a negative sign. Note that any problem can be
viewed from two perspectives. The lender and the borrower view the same problem
with reversed signs.
⎡
1 ( 1 I 100 )
⎢
I 100
⎣
Paym ents , P
2
Miscellaneous Programs and Equations
⎤
N
( F 1 I ( 100
⎥
⎦
3
)) B 0
N
N _ 1
Future Value, F
17
N
17-1