HP 10bII - Page 50

You can calculate any value after entering the other four. Cash flow
diagrams for loans, mortgages, leases, savings accounts, or any contract
with regular cash flows of the same amount are normally treated as TVM
problems. For example, following is a cash flow diagram, from the
borrower's perspective, for a 30-year, $150,000.00 mortgage, with a
payment of $1,041.40, at 7.5% annual interest, with a $10,000 balloon
payment.
PV = 150,000.00
N= 360 GO x 12)
357 358 359 360°
PMT = -1,041.40 |
FV=-10,000.00
One of the values for PV, PMT, FV can be zero. For example, following
is a cash flow diagram (from the saver's perspective) for a savings account
with a single deposit and a single withdrawal five years later. Interest
compounds monthly. In this example, PMT is zero.
PV =-17,000.00
Time value of money calculations are described in the next chapter.
50 4: Picturing Financial Problems