HP HP12C hp 12c_user's guide_English_E_HDPMBF12E44.pdf - Page 45

Section 3: Basic Financial Functions 45 Example 1: You're financing a new car purchase with a loan from an institution that requires 15% interest compounded monthly over the 4-year term of the loan. If you can make payments of $150 at the end of each month and your down payment will be $1,500, what is the maximum price you can pay for the car? (Assume the purchase date is one month prior to the date of the first payment.) Keystrokes fCLEARG 4gA 15gC 150ÞP g $ 1500+ Display 48.00 1.25 -150.00 -150.00 5,389.72 6,889.72 Calculates and stores n. Calculates and stores i. Stores PMT (with minus sign for cash paid out). Sets payment mode to End. Maximum amount of loan. Maximum purchase price. Example 2: A development company would like to purchase a group of condominiums with an annual net cash flow of $17,500. The expected holding period is 5 years, and the estimated selling price at that time is $540,000. Calculate the maximum amount the company can pay for the condominiums in order to realize at least a 12% annual yield. File name: hp 12c_user's guide_English_HDPMBF12E44 Printered Date: 2005/7/29 Page: 45 of 209 Dimension: 14.8 cm x 21 cm