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# Thread: Finance majors (will rep)

1. ## Finance majors (will rep)

I have a question about interest rates compounded daily

An investment will pay you \$58,000 in seven years. If the appropriate discount rate is 10 percent compounded daily, the present value is

I know I have this as a formula

PV = \$58,000 / [(1 + .10/365)7(365)] =

How do I do compounded (division of 365) with a financial calculator?

With a BA II financial calculator?

2. the imput for how many times its compounded should be 7*365 IIRC

just try various compounding amt to get the answer you get from equation.;

3. FV = 58,000
i/y = 10%
p/y = 365
n = 2555

hit CPT and you should get ~28k

Using TI BAII+

4. Originally Posted by TurkBrah
the imput for how many times its compounded should be 7*365 IIRC
I'm gonna try this right now.

This is, 1.10 should be divided by 365 too. Should I just put that in as I/Y? (1.10/365)

5. Originally Posted by the next arnold
FV = 58,000
i/y = 10%
p/y = 365
n = 2555

hit CPT and you should get ~28k

Using TI BAII+
Thanks man.

repped every1

edit: will come back after recharge

6. Originally Posted by Ace Thedics
I'm gonna try this right now.

This is, 1.10 should be divided by 365 too. Should I just put that in as I/Y? (1.10/365)
I/Y would be 10/365. It's input as a percent. So the nominal rate (10%) divided by the mthly period (m=365).

7. 29,763,17

8. Originally Posted by janis_t
29,763,17

close, it's 28k

Originally Posted by the next arnold
FV = 58,000
i/y = 10%
p/y = 365
n = 2555

hit CPT and you should get ~28k

Using TI BAII+
one more thing, how exactly do you do this?

Im hitting 2nd + py and it's not taking the value, keeps turning into 1.000000

9. 2nd - P/Y - 365 - Enter - 2nd - Quit

10. Woops, your right, didn't compound daily

28,788,93 then

11. Originally Posted by the next arnold
2nd - P/Y - 365 - Enter - 2nd - Quit
Awesome

12. Phil can afford \$180 a month for 5 years for a car loan. If the interest rate is 8.6 percent, how much can he afford to borrow to purchase a car?

Pretty stumped on this one.

What exactly am I solving for? PMT?

13. 8753

14. Originally Posted by janis_t
8753
Can you tell me what you're doing here? (thanks btw)

15. bump

16. You solve the Loan by using the PV Function, not PMT

Loan = 180 * (1 - (1 + 0.0071666)^-60) / 0.0071666 = 8752,85 -> ~ 8753

i per month : 0.086/12 = 0.0071666
payments: 5*12= 60 months

17. Originally Posted by Ace Thedics
Can you tell me what you're doing here? (thanks btw)
Using a BA2+

N - 60
I/Y - 8.6
P/Y - 12
PMT - 180

CPT - PV

= 8752.84

18. Accounting > Finance

(not srs)

srs

19. Originally Posted by ace thedics
i have a question about interest rates compounded daily

an investment will pay you \$58,000 in seven years. If the appropriate discount rate is 10 percent compounded daily, the present value is

i know i have this as a formula

pv = \$58,000 / [(1 + .10/365)7(365)] =

how do i do compounded (division of 365) with a financial calculator?

With a ba ii financial calculator?
58000 fv
10/365 int
7 * 365 n
pv

Oh yeah, HP 12C is better.

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