HP 42s Time value of Money

[JCT]

(05-07-2015 06:37 PM)Jeff_Kearns Wrote:  

(05-07-2015 05:23 PM)JCT Wrote:  Thanks guys!!!

I really appreciate it.

Jeff posted a link to the correct TVM program. Am I to assume the one in the manual is incorrect (now that I know how to type STO ST T)?

Thanks,

JT

The program listed in the user's manual is not as precise as the one in the link. It loses significant digits due to round-off errors for extreme cases of large numbers of compounding periods or really small periodic interest rates. Check out the examples in the General Software section on this site (example) and search the forum for additional info on this matter. The HP-15C Advanced Functions Handbook (available on the Museum DVD Set) has a section on this.

Try them both out and compare for the following case:

"Many Pennies (alternatively known as A Penny for Your Thoughts):

A corporation retains Susan as a scientific and engineering consultant at a fee of one penny per second for her thoughts, paid every second of every day for a year.
Rather than distract her with the sounds of pennies dropping, the corporation proposes to deposit them for her into a bank account in which interest accrues at the rate of 11.25 percent per annum compounded every second. At year's end these pennies will accumulate to a sum

total = (payment) X ((1+i/n)^n-1)/(i/n)

where payment = $0.01 = one penny per second,
i = 0.1125 = 11.25 percent per annum interest rate,
n = 60 X 60 X 24 X 365 = number of seconds in a year.

Using her (INSERT 'favourite' HP calculator) which she programmed with the TVM formula alone, Susan reckons that the total will be $376,877.67. But at year's end the bank account is found to hold $333,783.35 . Is Susan entitled to the $43,094.32 difference?"
31,536,000 STO 1
(11.25/31,536,000) STO 2
0 STO 3
-0.01 STO 4
5 STO I
f SOLVE E

The correct result is: $333,783.35."

Jeff Kearns

Thanks Jeff.

JT