Sharp EL733A EL-733A Operation Manual - Page 26

EX12 N2nd E[XVI

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divide it by12. Notice that the Pm F) 1÷11 function is provided above the Dl key for this exact purpose. The periodic rate is the only one that makes any sense to the calculator. PV = 94'000.00 i =10.5 +12 Also, along with the nominal APR that they divide by 12 n=30x12 FV 0 and use in their calculations, most lenders are required to quote the effective APR or true APR which is a calculated 35$454354p$59 ,1,601? annual rate that includes compounding (and finance charges). For now, don't try to use effective rates in your calculations. Calculating effective rates is covered on PMT = ? pages 72 and 90. PAYMENTS AT THE BEGINNING OF THE PERIOD Your EL-733A can be set to solve TVM problems with The amount financed completely paid off (FV is = 0) $94'000 (PV over a period = of 94'000) 30 years to or be 360 months at a information periodic interest rate of 0.875% is all there and, after reading per the month. The explanation to this point, you should understand most of the subtleties payments at either the beginning or the end of the about this mortgage problem. cash-flow period. The only reason that this is mentioned here is because if you have your calculator set to BGN mode, you will not be able to get the right answer in this Tcahseh-ffollolwowsicnhgekdeuyles.troMkaeks esosluvreeftohrethBeGpNayinmdeicnat tionr tihsenaobtoovne example. The 7 key is used to switch the calculator in in your display: and out of BGN mode. When the display indicator BGN is turned on, the calculator is set to solve TVM problems assuming payments occur at the beginning of the period. Keystrokes: 106'000 12'000 E N 10.5 PH 1-.-121 EJ 30 land9 X12 E io Why should it make any difference if the payments occur at 0 the beginning or at the end of the period? Well, think about LiLff,,a Result: -859.85 it.... The quicker the balance is reduced, the less interest is going to accumulate and the smaller the payment. So in this problem, be aware that your calculator should not be in BGN mode when you are solving for this mortgage Naroetisceeptahraattethfeun2cndt9io[n-Os2Iaabnodve2ntdhe[XLVUI fuanncdtioFnis keys provided for your convenience. They replace the keystrokes Dl 12 Q and 171) 12 payment. BGN mode is discussed more on page 56. [1), respectively. Take another look at the cash-flow schedule for this example:

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divide
it
by
12.
Notice
that
the
Pm
F)
1÷11
function
is
provided
above
the
Dl
key
for
this
exact
purpose.
The
periodic
rate
is
the
only
one
that
makes
any
sense
to
the
calculator.
Also,
along
with
the
nominal
APR
that
they
divide
by
12
and
use
in
their
calculations,
most
lenders
are
required
to
quote
the
effective
APR
or
true
APR
which
is
a
calculated
annual
rate
that
includes
compounding
(and
finance
charges).
For
now,
don't
try
to
use
effective
rates
in
your
calculations.
Calculating
effective
rates
is
covered
on
pages
72
and
90.
PAYMENTS
AT
THE
BEGINNING
OF
THE
PERIOD
Your
EL
-733A
can
be
set
to
solve
TVM
problems
with
payments
at
either
the
beginning
or
the
end
of
the
cash
-flow
period.
The
only
reason
that
this
is
mentioned
here
is
because
if
you
have
your
calculator
set
to
BGN
mode,
you
will
not
be
able
to
get
the
right
answer
in
this
example.
The
7
key
is
used
to
switch
the
calculator
in
and
out
of
BGN
mode.
When
the
display
indicator
BGN
is
turned
on,
the
calculator
is
set
to
solve
TVM
problems
assuming
payments
occur
at
the
beginning
of
the
period.
Why
should
it
make
any
difference
if
the
payments
occur
at
the
beginning
or
at
the
end
of
the
period?
Well,
think
about
it
....
The
quicker
the
balance
is
reduced,
the
less
interest
is
going
to
accumulate
and
the
smaller
the
payment.
So
in
this
problem,
be
aware
that
your
calculator
should
not
be
in
BGN
mode
when
you
are
solving
for
this
mortgage
payment.
BGN
mode
is
discussed
more
on
page
56.
Take
another
look
at
the
cash
-flow
schedule
for
this
example:
PV
=
94'000.00
i
=10.5
+12
n=30x12
FV
0
PMT
=
?
35$454354p$59
,
1,601
?
The
amount
financed
is
$94'000
(PV
=
94'000)
to
be
completely
paid
off
(FV
=
0)
over
a
period
of
30
years
or
360
months
at
a
periodic
interest
rate
of
0.875%
per
month.
The
information
is
all
there
and,
after
reading
the
explanation
to
this
point,
you
should
understand
most
of
the
subtleties
about
this
mortgage
problem.
The
following
keystrokes
solve
for
the
payment
in
the
above
cash
-flow
schedule.
Make
sure
the
BGN
indicator
is
not
on
in
your
display:
Keystrokes:
106'000
12'000
E
N
10.5
PH
1-.-121
EJ
30
land9
X12
E
0
Result:
—859.85
LiLff,,a
Notice
that
the
2nd
9
[-O2I
and
2nd
[XVI
functions
are
separate
functions
above
the
LU
and
Fi
keys
provided
for
your
convenience.
They
replace
the
keystrokes
Dl
12
Q
and
171)
12
[1),
respectively.
io