Summary
Summary DSC1630 - Introductory Financial Mathematics (DSC1630)
- Course
- Institution
This document contains extensive details about the formulas and how to use them on a calculator
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SimpleInterest i. Discount
-
Chapter 2 -
To Calculate interest
formulas :
To Calculate
Prt
future Amount
I -
-
the
To Calculate
discount amount
S =p ( I + rt ) or interest amount
P=S( i -
r t) p%%%ñi•b
" "
d
r =
,-dt
Interest
•
p =
Present Value "' " ' only
"ted
r
=
Interest Rate
t Time in years
time of
in the
loan
=
I Interest Received / Paid
Only one
=
0
principal value
deposited /
}g }g
Replace R with D when discount Received
is mentioned in
question
p -
-
sci -
dt ) only applicable to
discount NOTINTER.cl#
, " " l t
' \ 1
I ,
,
,
,
⑥MMPPOOUUNNDD -
-
TINNTTCERREESSTT -
\
. '
1
' ' , I
I 1 1
foirmuas
Only 1
principal value
-
S=p[i+Imm_]tM
=
-
Earn interest on
interest .
Interest
)^
calculations
-
S =
P( / + I done
compounding periods
according to
in a year
S =
future Value
P = Present Value ON THE CALCULATE R :
M =
Number of Compound periods in 1 year Pr .
present value
time in years
N Compound periods /☒
im Nominal Interest Rate PY
=
=
Interest Rate
.
Ily
.
.
t =
time in YEARS fv =
future value
PM
compound periods ( tm) compounding periods
=
N =
Years times per year
- Steps on Calculator -
1) Zndf CA : To clear prior values
2) 2nd F P / 4. EMT ,
ENT ,
ON 10 PM
3) Years ✗ Compounding period es =
-
NN N
4) ± FV IPV :
Depending on known Value PV
9) Interest Rate I /Y Denotes IN
,
6) Comp PV IFV
:
Depending on unknown Value
, Egg EFFECTIVE RATE
Compound Interest }g
Formulate :
Jeff =
100¢ IF )M 1)
/+ -
Jeff =
Effective Interest Rate
im Nominal Interest Rate per
year
=
m =
Compounding periods per year .
On the Calculator :
Calculate EFFECTIVE rate :
1 2nd f CA
z
Type nrot compounding periods
-3 Press the (
N.y ) button
+
Type in the interest Rate :
Do Not Convert
as
2nd -5 → EFF
calculate NOMINAL Rate
1 2nd f CA
Type nrot compounding
z
periods
-3 Press the (
N.y ) button
+
Type in the interest Rate :
Do Not Convert
as
2nd -5 → APR
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