Cash Flow Calculations
97
The cash flows that describe your prospective investment are now in the calculator. Press
v¤. Press 1 or A to scroll through the list and verify the cash flows and the
repeat value is entered correctly. Press M to exit.
Now that you have entered the cash flows, store the interest rate and calculate the net present
value and net future value.
Table 8-8 Calculating NPV and NFV
This result shows that if you want a yield of 15% per year, you should pay 27,199.92 for the
contract. Notice that this amount is positive. The net present value is simply the summed (or
netted) value of a series of cash flows when they are discounted to the front of the time line.
:ÆY¤
4.00
(CFn 4 flashes, then
disappears)
Input fifth cash flow amount and
repeat value.
jV::ÆJ¤
1. 0 0
(CFn 5 flashes, then
disappears)
Input sixth cash flow amount and
repeat value.
:Æd¤
9.00
(CFn 6 flashes, then
disappears)
Input seventh cash flow amount and
repeat value.
J::::ÆJ¤
1. 0 0
(CFn 7 flashes, then
disappears)
Input eighth cash flow amount and
repeat value.
Keys Display Description
JVÒ
15.00 Store annual interest rate
\½
27,199.92 Calculate net present value of
stored cash flows.
\«
37,105.94 Calculate NFV of stored cash
flows.
Keys Display Description