6: Interest Rate Conversions 89
effective interest rate based on your payment periods. Last, convert the
effective rate to the nominal rate based on the bank’s compounding
periods.
Example: Balance of a Savings Account. Starting today, you make
monthly deposits of $25 into an account paying 5% interest
compounded daily (365-day basis). At the end of 7 years, how much
will you receive from the account?
Keys: Display: Description:
"
h
FH9H7:
7E05E4<A;<="
i
7E05E4<A;<= 5"
:;0HF?@2"
Periodic interest-rate
conversion menu.
365
1
58%'.&((" Stores bank’s
compounding periods.
5
j
<E068.&((" Stores bank’s nominal
interest rate.
k
HGG68.&#%" Calculates effective interest
rate for daily compounding.
12
1
58#$&((" Stores number of deposits
per year.
j
<E068.&(#" Calculates equivalent
nominal interest rate for
monthly compounding.
ee
]
<
"
.&(#"
Switches to TVM menu;
NOM% value is still in
calculator line.
s
U
;6@28.&(#" Stores adjusted nominal
interest rate in I%YR.
.
12
Y
Z
e
"
#$ 5?@2 JH=;< 0EAH"
Sets 12 payments per
year; Begin mode.
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