Future Value with Quarterly Compounding
Exercise ID: tvm-real-001
Description
An investor deposits $5,000 into an account that pays a stated annual interest rate of 8%, compounded quarterly. Calculate the value of the account at the end of 3 years.
Given Values
Objective
Calculate FV
Steps
Total 10 stepsStep 1:Clear TVM Registers
💡 Always clear TVM before starting a new problem.
Key Sequence:
Before Key Press:
0.00
After Key Press:
0.00
⏱ 1500ms
Step 2:Input N = 12
Key Sequence:
Before Key Press:
0.00
After Key Press:
12
⏱ 1400ms
Step 3:Store in N
Key Sequence:
Before Key Press:
12
After Key Press:
N=12.00
⏱ 1000ms
Step 4:Input I/Y = 2
Key Sequence:
Before Key Press:
N=12.00
After Key Press:
2
⏱ 1200ms
Step 5:Store in I/Y
Key Sequence:
Before Key Press:
2
After Key Press:
I/Y=2.00
⏱ 1000ms
Step 6:Input PV = -5000
Key Sequence:
Before Key Press:
I/Y=2.00
After Key Press:
-5000
⏱ 2000ms
Step 7:Store in PV
Key Sequence:
Before Key Press:
-5000
After Key Press:
PV=-5000.00
⏱ 1000ms
Step 8:Input PMT = 0
Key Sequence:
Before Key Press:
PV=-5000.00
After Key Press:
0
⏱ 1200ms
Step 9:Store in PMT
Key Sequence:
Before Key Press:
0
After Key Press:
PMT=0.00
⏱ 1000ms
Step 10:Compute FV
Key Sequence:
Before Key Press:
PMT=0.00
After Key Press:
FV=6341.21
⏱ 1500ms
- 1.Forgetting to adjust N and I/Y for quarterly compounding
- 2.Entering PV as positive (resulting in negative FV)
- 3.Not clearing TVM registers before starting
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