Calculated Industries 3420 User Guide - Manual (Page 44)

U SER ’ S G UIDE — 43
Finding the Yield on a Discounted Note
An individual wants to sell you a note under the following terms: 60
months remaining in the term, a face amount when due of $7,500,
10% interest-only payments of $62.50 (incoming). He says he will
sell this note to you for $6,500 if you buy today. If you buy it, what
will be the yield on your investment?
STEPS KEYSTROKES DISPLAY
Clear calculator o o 0.00
Enter Future Value of
note when due 7 5 0 0 s l 7,500.00
Enter purchase Price 6 5 0 0 l 6,500.00
Enter Remaining Term 5 T 5.00
Enter Payment Amount 6 2 • 5 0 p 62.50
Find your Yield ˆ “run” 14.09
— DO NOT CLEAR CALCULATOR —
What should you pay for this trust deed if you want an 18% yield on
your investment?
STEPS KEYSTROKES DISPLAY
Enter your desired Yield 1 8 ˆ 18.00
Find purchase Price l “run” 5,663.44
3420UG-E-A 7/2/04 9:06 AM Page 43