ABSTRACT
Interest defined and calculated using compound, simple and other accumulation and amount functions. Computing the nominal and effective rates of interest in the case that the unit of time for N is different from that for I/Y. Includes an introduction to the concept of varying interest rates which will be treated in more detail in later chapters. Computing the present and future value based on given interest rates and the converse.
Substantial instruction in solving problems in interest using the TI BA II Plus calculator TVM keys: N (time period involved), I/Y (effective rate of interest), PV (present value), PMT (periodic payments, if any), FV (future or accumulated value). Given the value of any four of the five TVM variables the fifth number can be calculated.
The concepts in this chapter form the basis for a large portion of the later chapters.
