HP 12C Financial calculator - Manual (Page 160)

160
File name: hp 12c_user's guide_English_HDPMBF12E44 Page: 160 of 209
Printered Date: 2005/7/29 Dimension: 14.8 cm x 21 cm
Section 15
Savings
Nominal Rate Converted to Effective Rate
Given a nominal interest rate and the number of compounding periods per year,
this keystroke procedure computes the effective annual interest rate.
1. Press g and fCLEARG.
2. Key in the annual nominal rate as a percentage, then press \.
3. Key in the number of compounding periods per year, then press nz¼.
4. Key in 100 then press Þ\$.
5. Press M+ to obtain the effective annual interest rate.
Example 1: What is the effective annual interest rate if the annual nominal rate
of 5
1 /
4
% is compounded quarterly?
Keystrokes Display
gÂ
fCLEARG
5.25\ 5.25 Nominal rate.
4nz¼ 1.31 Percent quarterly interest rate.
100Þ\
$M+ 5.35 Percent effective interest rate.
For repeated calculations, the following hp 12c program can be used:
KEYSTROKES DISPLAY KEYSTROKES DISPLAY
fs 0 07- 0
fCLEARÎ 00- 0 08- 0
gВ 01- 43 8 Ю 09- 16
fCLEARG 02- 42 34 \ 10- 36
n 03- 11 $ 11- 13
z 04- 10 M 12- 15
¼ 05- 12 + 13- 40
1 06- 1 fs