Compute Present Value of Future Payments Using an HP12c Platinum

This video simply shows how to compute the present value of future payments with compound interest. In short, the user wants to know how much money he should have set aside by the time his daughter enters college assuming she will take 4 years to complete her education and will deduct $500 per month with 6% compounded interest. The example comes from page 12 of the HP 12c Platinum Financial Calculator 5th Edition English User's Guide.

Category:

Education

Tags:

• HP
• 12c
• Platinum
• Compute
• Present
• Value
• BYU-Hawaii
• Accounting
• 232B

[zw0ecool]

anyone who can use the 12c hp calculator with superb ability should get hired at any bank or financial job on the spot, this calculator is awesome

[KimballAtBYUHawaii]

@zw0ecool Naturally, it is not just knowing how to use the calculator, which is a valuable skill in and of itself, but it is the ability to listen to a financial situation and be able to know which functions in the calculator relate to the problem at hand. It is this latter skill that is the most difficult to teach and for which people really get paid.

[marcel911]

Nice HP12C emulator. What's it called? Where do you get it? I use a 12C app on my iPhone, but I'd love one for my PC at work.

[KimballAtBYUHawaii]

Sorry, I just now saw your question, so here is my response ( a little delayed).

If you are an educator, you can contact HP directly in the education department and ask for an emulator. I believe they have emulator software for all their calculators so teachers can use their PCs and a computer projector.

[ColdGambler]

wait a second ,you´re answer is incomplete isn´t it ? you calculated how much money is needed at the start of the 4 years , but this "start" is in 14 years from today . So you have to calculate how much you need to put today to achieve this amount in 14 years . its quite simple , just wanted to say that its missing this part . Nice vid , im learning how to use Hp for college now , thx , u helped me

[coronet]

What a badass thing to calculate right there from a calculator you can fit in a shirt pocket. Just being able to pull out one of these and perform a financial equation right in front of someone is serious genius credit right there.

[shlayma]

@tdawg611 Duhhh!!!

lol dunno why i divided by 360??!!!

stupid mistake :D

[tdawg611]

@shlayma

While you have the right idea, figuring the amount of months, you are slightly off on your interest rate. 7.25 is the yearly interest rate, so 7.25 should be divided by 12, not 360.

i=.6042

PMT month= $2,379.16

[zw0ecool]

@KimballAtBYUHawaii agreed, that is what i meant. 

[zw0ecool]

this hp calculator owns

[shlayma]

@cuevanomics

Enter it like this on calculator :

PV = $348760

n = (30 x 12) = 360

i = (7.25 / 360) = 0.02

PMT per month = $1004.17

i hope that is correct:)

[KimballAtBYUHawaii]

Certainly an option.