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+--- Thread: Help using BAII Calculator (/Thread-Help-using-BAII-Calculator)
Help using BAII Calculator - PCCLEP - 07-03-2007
Anyone know how to use the BAII calculator to solve these two problems? I've figured out how to solve the other problems with the BAII, but these "equal annual problems" I can not figure out which buttons to use.
Thanks for the help.
Question 26 of 35
A man borrows twenty-seven thousand dollars for a new car and will repay the loan in equal annual payments over the next 10 years. The interest rate on the loan is 7%. How much is each end of the year payment? Finance Tables
$3,428.93
$2,889.00
$3,844.19
$4,213.78
Detailed Explanation:
$3,844.19.
3844.19257 = 27000/[(1/.07) - (1/(.07(1.07^10)))]
Annual Fixed Payments = Present Value/[(1/interest rate) - (1/(interest rate((1+interest rate)^number of years)))]
Question 27 of 35
A woman wins a sweepstakes giving away two hundred fifty thousand dollars. She has two options for receiving the money; she can either take twenty five thousand dollars a year for ten years, or she can get the present value of two hundred fifty thousand dollars in ten years, now. If she chooses the first option, with a discount rate of 11%, what is the present value of twenty five thousand dollars a year for ten years? Finance Tables
$42,450.36
$153,412.54
$220,000.00
$147,230.80
Detailed Explanation:
$147,230.80.
147,230.80 = 25000[(1/.11) - (1/(.11(1.11^10)))]
Present Value = Annual Fixed Payments[(1/interest rate) - (1/(interest rate((1+interest rate)^number of years)))]