We can use PM1 to evaluate the proportion of interest : principal of any repayment
for the course of the loan. Additionally, PM2 can be used to isolate any period of the
loan to evaluate the proportion of the sum of interest : principal, and show the
balance remaining on the loan after the installment PM2.
Make PM1 = 1 and PM2 = 12. This will allow us to consider the following:
For PM1 = 1 the proportion of interest : principal for the first installment of the
loan.
For PM2 = 12 the proportion of the sum of interest : principal for the first year of
the loan, and the balance remaining on the loan after the first
year.
For the $1264.14, the amount of each installment to be made on the loan, identify
how much of the first installment is absorbed as interest and how much of the
installment goes toward reducing the principal, press INT (F2), REPT (F1), PRN (F3).
To evaluate how much interest and principal is paid off the loan in the first year, and
the balance remaining on the loan at the end of the first year press ΣINT (F4), REPT
(F1), ΣPRN (F5), REPT (F1) then BAL (F1)
After establishing the balance remaining after the first year, press GRPH (F6) to view
the cash flow graph and press TRACE (SHIFT F1).