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College Funding (Two-Stage)

Exercise ID: tvm-real-014

Exam TrapsSingle Sums

Description

Need $25,000 per year for 4 years, first payment 10 years from today. Earn 6%. How much to deposit today?

Given Values

N
9
I/Y
6%
PMT
0
FV
86627.64
PV
0

Objective

Calculate PV

Steps

Total 10 steps

Step 1:Clear TVM Registers

💡 Always clear TVM before starting a new problem.

Key Sequence:

2ndFV

Before Key Press:

0.00

After Key Press:

0.00

⏱ 1500ms

Step 2:Input N = 9

Key Sequence:

9

Before Key Press:

0.00

After Key Press:

9

⏱ 1200ms

Step 3:Store in N

Key Sequence:

N

Before Key Press:

9

After Key Press:

N=9.00

⏱ 1000ms

Step 4:Input I/Y = 6

Key Sequence:

6

Before Key Press:

N=9.00

After Key Press:

6

⏱ 1200ms

Step 5:Store in I/Y

Key Sequence:

I/Y

Before Key Press:

6

After Key Press:

I/Y=6.00

⏱ 1000ms

Step 6:Input PMT = 0

Key Sequence:

0

Before Key Press:

I/Y=6.00

After Key Press:

0

⏱ 1200ms

Step 7:Store in PMT

Key Sequence:

PMT

Before Key Press:

0

After Key Press:

PMT=0.00

⏱ 1000ms

Step 8:Input FV = 86627.64

Key Sequence:

86627DECIMAL64

Before Key Press:

PMT=0.00

After Key Press:

86627.64

⏱ 2600ms

Step 9:Store in FV

Key Sequence:

FV

Before Key Press:

86627.64

After Key Press:

FV=86627.64

⏱ 1000ms

Step 10:Compute PV

Key Sequence:

CPTPV

Before Key Press:

FV=86627.64

After Key Press:

PV=-51279.50

⏱ 1500ms

Calculator Display
0.00
Speed:← →
💡 Press Space to quickly pause/play
⚠️ Common Mistakes and Traps
  • 1.Discounting back 10 years instead of 9
  • 2.Treating it as a single 14-year annuity
  • 3.Rounding errors in intermediate steps

(Expand the sections to view answers and common mistakes before printing.)

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