Advertisement
Hewlett-Packard 10B Tutorial
Page 8
Cash Flow Operations
Example 1: Uneven Cash Flows
Assume the following cash flows:
What is the PV of these CFs?
First clear the HP and make sure that periods/year is set equal to 1.
CF
0
j
CF
50
j
CF
100
j
CF
150
j
CF
200
j
The CFs from the time line are entered. Now enter the interest rate.
I/YR
10
At this point the HP knows the cash flows, the number of periods, and the interest rate. To find the PV,
NPV
press
to get PV = NPV = $377.40.
Example 2: Embedded Annuities
We have these cash flows, which contain embedded annuities:
0
10%
/)))))))3))))))3))))))3))))))3))))))3))))))3))))))3))))))3))))
))1
0
0
1
10%
/))))))))3))))))))3))))))))3))))))))1
0
50
Sets CF
equal to 0.
0
Sets CF
equal to 50. On next entry, hold down CF
1
holding down CF
key, you see that you just entered CF
j
1
2
3
100
100
100
2
3
100
150
4
5
6
200
200
300
4
200
key to see what it says. By
j
.
2
7
8
9
300
300
300
Advertisement
