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Basic Question 6 of 13
You have $1,000 to invest today. In order for your $1,000 investment to grow to $1,593.85 at the end of 8 years, the money must be invested at what interest rate?
B. 7%
C. 8%
A. 6%
B. 7%
C. 8%
User Contributed Comments 17
| User | Comment |
|---|---|
| Laurel | Need to figure out how to input exponents (1/8) into calculator. |
| NConroy | 1\8 = 0.125 |
| KD101 | Why exponent , it is power of (1/8) - just use brackets to do it |
| jaan | Its very easy just 1593.85 /1000 =15.9385 then press Yx (1/8)= - 1 *100 = 6% |
| mark72 | On the TI BAII Plus: PV = 1000 FV = -1593.85 N = 8 Compute I/Y = 6.000 |
| nads2007 | Great help mark72 |
| Crown01 | Just take 1.59385 and three time stroke square-root key. ->1.06 ->6% interest |
| SriSri | Why not PV=-1000 and FV=+1593.85, you invest 1000 so - and receiving 1593.85 in future so +. Please help confused here with BAii cal |
| midwest | i am following mark72's explanation, which is how i originally tried to solve for the problem...however, when I press CPT I/Y I get "Error 5" - can anyone help me with this? |
| midwest | oh, nevermind...I wasn't using the (-) sign for FV |
| Mavizo | I used mark7's method but still I keep getting 30 as an answer. Can somebody help please!!! |
| fedha | try clearing the calculator press 2nd OUIT 2nd [CLR TVM] This might help clear any worksheet material still saved. Then follow mark72 |
| mwali | Iam having a problem like midwest. I keep getting error 5 even after using (-) for FV. Can Someone help am getting nervous. |
| allenlush | do not forget to clear your calculator before doing a TVM problem. With BAII+ : 2nd CLR TVM (-) 1,000 -> PV 1,593.85 -> FV 8 -> N CPT I/Y = 6 It doesn't matter you put the negative sign (-) on PV or on FV. |
| Huricane74 | If you want to calculate this using a formula, use the: Growth rate Formula: r = [ (FV / PV ) ^ (1/n) ] - 1 |
| elsaharty | Please, how to can make ( )^1/8 on HP12c |
| EmmaTberry | I am having the same problem as Mwali and Midwest. I have cleared the calculator and am inputting everything as everyone has suggested and keep receiving error 5 as an answer (on BAII Plus) Have had no issues computing anything else, only problem is trying to compute I/Y. Anybody know how to fix this? |
I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
Barnes
Learning Outcome Statements
calculate and interpret annualized return measures and continuously compounded returns, and describe their appropriate uses
CFA® 2024 Level I Curriculum, Volume 1, Module 1.