Solution 11238: Computing for Number of Periods (N) Using the BA II PLUS™ or BA II PLUS™ PROFESSIONAL Financial Calculator.
How can I compute for the number of periods (N) using my BA II PLUS or BA II PLUS PROFESSIONAL?
To compute for the number of periods (N) using the BA II PLUS or BA II PLUS PROFESSIONAL, follow the example below.
For Example: An investor opens a savings account that she
wants to be worth $10,000 in the future. She makes an initial deposit of
$3,768.89. The bank pays 5% interest, compounded at the end of each year. How
many years will it take to accumulate $10,000 in the savings
account?
Enter the following:
N = ?
I/Y = 5
PV =
-$3,768.89
PMT = 0
FV = $10,000.00
Compute as
follows:
1) Press [2nd] [RESET] [ENTER] to reset the
calculator.
2) Press [2nd] [P/Y] to enter the P/Y worksheet.
3) For P/Y,
input 1 and press [ENTER]. This sets the calculator up for annual periods (N).
This also sets the C/Y (compounding periods) to annual periods.
4) Press
[2nd] [QUIT] to exit the P/Y worksheet.
5) Input 3768.89, press the [+/-]
key, and press the [PV] key.
6) Input 5 and press the [I/Y] key.
7) Input
10000 and press the [FV] key.
8) Press [CPT] [N].
The calculator will
return N = 20 as the solution. This means it will take 20 years to accumulate
$10,000 in the savings account.