calculating arithmetic progression using BA II?

CFA Level I
#1

does anyone know?

#2

a + (n-1)*d – plug and chug.

what do you need to know?

#3

what? your formula is no where close to the formula taught at my uni

if I want to find present value of a cashflow at 10% pa. where payment of

$200 in year 1

$400 in year 2

$600 in year 3

…

…

$2000 in year 10

edit: $2000 in year 10 not $200…

How do I do that on the BA II Plus?

#4

did not understand what you meant by arithmetic progression at all.

You have the cash flow function on the TI BA II calculator

2nd CF …

and keep using the down arrow to input the values

then hit 2nd npv to enter the rate I and calculate the npv.

#5

I have no idea what an “arithmetic Progression” is, but I think I can chime in here.

Do not substitute the calculator for good problem-solving skills and a little bit of pencil-pushing.

EG - A person asked “How do I calculate standard deviation on the calculator?” The answer is–I don’t know. Just do it the long way. Find the average of all the data points. Take the difference between the data points and the average. Square the differences. Average the differences. Take the the square root of that average.

You’ll learn the material and probably make less mistakes. Do not rely on the calculator. (Except for NPV problems, especially when there is an annuity or cash flows involved.)

#6

Sorry I should have explained a bit better, maybe this is not in the CFA program at all but just a uni question where they want us to use this really long formula to find PV and FV of arithmetic and geometric progression.

Basically,

Arithmetic progression is a sequence of numbers where any two consecutive numbers are separated by a common difference

eg. $100, $200, $300, $400 … …

Geometric progression is a sequence of numbers where the ratio of any two consecutive numbers are is contant

$100, $110, $121, $133.1 …

the formula for PV using arithemic progression is

PV=PMT\left[\dfrac{(1+r)\left[\dfrac{1-(1+r)^{-n}}{r}\right]-n(1+r)^{-n}}{r}\right]

(put this into your latex editor to view the formula)

I was wondering if there is a way to directly calculate using a worksheet on BA II plus, hence why I posted here assuming arithmetic and geometric progression is part of CFA curriculum.

cpk123

your method would work if there is few payments, what if the question asks 12 monthly payments for 30 years?