Financial Calculations; Sample Calculation Of The Future Value (Fv) Of A Single Payment - Texas Instruments BA II Plus User Manual

F
INANCIAL CALCULATIONS
Most financial calculations are carried out using the following seven keys:
Financial keys
N
I/Y
PV
FV
PMT
CPT
BGN
Note:
By convention, the present value of an investment is a negative value. The calculator is
programmed this way; therefore, in calculations of future values or per-period payments, if the
present value is entered as a negative value, the future value or the value of the payments will
be positive. The opposite is also true. It is therefore important to be thorough and refer to the
calculator's user guide, if necessary.

Sample calculation of the future value (FV) of a single payment

Someone wishes to invest $4,000 in a registered retirement savings plan (RRSP) for a five-year
period.
Insurer A proposes an annual compound interest rate of 6%, whereas insurer B proposes a
nominal rate of 5.95% compounded on a semi-annual basis. The following two tables should
help you determine which insurer is proposing the best investment.
These keys are used to designate or calculate:
The number of periods.
The nominal interest rate.
The present value of an investment.
The future value of an investment.
The periodic payment of an amortized loan or a split
annuity.
Compute key.
Indicates whether the calculations include the payments
made at the beginning or at the end of each period.
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