Is there a quick way to do Question 19 on page 342 Reading 6: Time Value of Money on the ba ii plus (as opposed to typing all those numbers in and compounding)? And how would you do it? Thanks in advance.
It depends on what qualifies as quick to you.
The straightforward, relatively quick calculation is:
((4,000(1.02)2 + 8,000)(1.02)2 + 7,000)(1.02)2 + 10,000
Alternatively, you can put in these cash flows:
0, 4000, 0, 8000, 0, 7000, 0, 10000
Compute NPV with i = 2%. Using that value as PV, compute the FV after 8 periods.
You can also use the TVM worksheet to calculate the FV of each individual deposit:
2nd CLR TVM
P/Y=C/Y=1, PMT=0 for all payments
For the first deposit:
6 N, 2 I, PV=-4000 CPT FV 4,504.6496
Repeat for all other deposits, changing N and PV as appropriate. You can store the FVs in memory and sum them up.
It’s not very quick, but saves you the time of doing the compounding.
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