- How do you carry forward operations in the BAII Plus Professional. As an example, Example 13 in reading 5 is a two part problem, and you use the PV from part one as the FV for part two. Is there a way to continue working with the first solution without having to CLR TVM? 2) What do you enter in the P/Y and/or C/Y if you’re compounding continuously for PV or FV? I know these are probably easy questions, but I’ve never used this calculator before so I’m trying to get the hang of it. Thanks. And for what it’s worth, good luck to all you taking the test tomorrow.
One additional question: 3) How do you solve for time period on the calculator, like how long does it take for 10m to double to 20m assuming a 5.5% growth rate? If I input the variables into my calc and try solving for N, it gives me an error.
Got the answer to #3. I wasn’t using negative values for cash outflows, so when I did that it worked.
billy22g Wrote: ------------------------------------------------------- > One additional question: > > 3) How do you solve for time period on the > calculator, like how long does it take for 10m to > double to 20m assuming a 5.5% growth rate? If I > input the variables into my calc and try solving > for N, it gives me an error. did you make sure one the 10m is a negative number? because thats how much you pay today to get 20m X years from now. So the number should be negative (cash outflow)
if you are gonna answer your own question next time, warn us. I fking hate guys like you. Why dont you just die (sry but i m just frustrated from yesterday)
No worries man, the frustration is understandable. That’s why I typed that immediately, so someone wouldn’t waste their time. Apologies. The first two questions I don’t think I’m figuring out any time soon, so don’t worry about me getting those.
I think I can answer the 1st Q for you: If you have a TVM that requires two parts. Let’s say you have to calculate the PV of a certain amount and discount it again without payments. You would calculate the PV of the first part and hit FV. That will now be the future value. Enter 0 for PMT and PV, change the appropriate time and rate if applicable, and solve for PV.
Thanks bpdulog. Got another one. 4) How do you calculate NPV for perpetuity cash flows? For example, I invest $1m and expect to achieve $150,000 a year in perpetuity. Cost of capital is 10%. With yearly cash flows for an amount of time, I know how to do those, but not sure how to implement the cash flow worksheet for perpetuity. Thanks.
If you wanna do it using the calculator, I think you can put 500 for N. But the old fashioned way would be the cash flow divided by the cost of capital.
billy22g Wrote: ------------------------------------------------------- > Thanks bpdulog. Got another one. > > 4) How do you calculate NPV for perpetuity cash > flows? For example, I invest $1m and expect to > achieve $150,000 a year in perpetuity. Cost of > capital is 10%. > > With yearly cash flows for an amount of time, I > know how to do those, but not sure how to > implement the cash flow worksheet for perpetuity. > Thanks. Just use the perpetuity formula: PV = C/r C = 150,000 r = 10% therefore PV = 1.5m NPV = 1.5m - 1m = 500,000 No need to use the built in NPV function.
Cool, thanks to both of you. Anyone know about the continuous compounding, my 2nd question? I have a feeling I’m going to be asking a lot of these, so try to bear with me. You won’t offend if you don’t answer. Thanks again.