How To Set Up Ti 84 Plus

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The TI 84 Plus Calculator

The TI-84 Plus is a fairly easy, simply more than difficult than most, to employ financial figurer which will serve yous well in all finance courses. This tutorial will demonstrate how to use the financial functions to handle time value of money problems and make financial math easy. I will go on the examples rather unproblematic, but understanding the basics is all that is necessary to learn the estimator.

Initial Setup

There is one adjustment which needs to exist made before using this calculator. By default the TI-84 displays only two decimal places. This is not enough. Personally, I like to encounter five decimal places, but you may prefer some other number. To change the display, press the Fashion central, then the down arrow cardinal once (to the Float line). Next, utilise the right arrow key to highlight the 5 and printing Enter. Finally, press 2nd MODE to exit the carte du jour. That'southward it, the calculator is ready to become.

This tutorial will make extensive apply of the TVM Solver, but the TI 84 Plus offers additional financial functions in the Finance menu.

If you lot have come here because y'all are experiencing a problem, you might check out the FAQ. If you don't observe the solution, please send me a notation.

Example ane - Hereafter Value of Lump Sums

We'll begin with a very uncomplicated problem that will provide you with almost of the skills to perform financial math on the TI-84:

Suppose that y'all have $100 to invest for a flow of v years at an interest rate of 10% per year. How much will yous have accumulated at the end of this time menses?

In this problem, the $100 is the present value (PV), Due north is 5, and i is 10%. Before inbound the information you demand to put the reckoner into the TVM Solver mode. Printing the Apps push, choose the Finance carte (or press the 1 key), and so choose TVM Solver (or press the one primal). Your screen should now look like the ane in the flick. Enter the data as shown in the table beneath.

Field	Entry
Due north	5
I%	10
PV	-100
PMT	0
FV	0
P/Y	ane
C/Y	1

Now to find the hereafter value simply coil to the FV line and press Blastoff Enter. The answer you go should be 161.05.

A Couple of Notes

Every fourth dimension value of coin trouble has either 4 or 5 variables (respective to the five basic financial keys). Of these, you will e'er be given 3 or 4 and asked to solve for the other. In this case, we take a 4-variable problem and were given 3 of them (N, I%, and PV) and had to solve for the 4th (FV). To solve these issues you only enter the variables that you lot know on the appropriate lines and and then curl to the line for the variable yous wish to solve for. To go the answer press Alpha Enter. Exist sure that any variables non in the trouble are set to 0, otherwise they volition be included in the calculation.
The order in which the numbers are entered does not matter.
Ever make certain that the P/Y (payments per twelvemonth) and C/Y (compounding periods per year) are set to 1. At least this is what I prefer. Since these are visible on the screen at all times, it is not strictly necessary. If you can think to alter these to the advisable values for each trouble (one for annual compounding, 12 for monthly compounding, etc) then you lot'll accept no bug.
When nosotros entered the involvement rate, we input 10 rather than 0.10. This is because the figurer automatically divides any number entered on the I% line by 100. Had you entered 0.10, the futurity value would have come out to 100.501 — obviously wrong.
Notice that we entered the 100 in PV as a negative number. This was on purpose. Most financial calculators (and spreadsheets) follow the Cash Flow Sign Convention. This is simply a way of keeping the direction of the cash period straight. Cash inflows are entered as positive numbers and greenbacks outflows are entered as negative numbers. In this trouble, the $100 was an investment (i.eastward., a cash outflow) and the futurity value of $161.05 would be a cash inflow in five years. Had you entered the $100 as a positive number no harm would have been done, just the reply would have been returned as a negative number. This would be right had you borrowed $100 today (cash arrival) and agreed to repay $161.05 (cash outflow) in five years. Practise not change the sign of a number using - (the "minus" key). Instead, use (-).
We can alter any of the variables in this problem without needing to re-enter all of the data. For example, suppose that we wanted to find out the future value if we left the money invested for 10 years instead of 5. Only enter 10 on the N line and solve for FV. You'll detect that the answer is 259.37.

Example one.1 — Present Value of Lump Sums

Solving for the present value of a lump sum is nearly identical to solving for the future value. 1 important thing to recall is that the present value will always (unless the interest charge per unit is negative) be less than the future value. Proceed that in mind considering it can help you to spot incorrect answers due to a wrong input. Let's try a new trouble:

Suppose that y'all are planning to ship your daughter to college in 18 years. Furthermore, presume that you lot have adamant that y'all volition need $100,000 at that time in order to pay for tuition, room and board, political party supplies, etc. If you lot believe that you can earn an average annual rate of return of 8% per year, how much money would yous need to invest today as a lump sum to attain your goal?

In this case, we already know the future value ($100,000), the number of periods (eighteen years), and the per period interest rate (8% per year). We want to find the present value. Go to the TVM Solver and enter the data every bit follows: 18 into N, eight into I%, and 100,000 into FV. Note that we enter the $100,000 as a positive number because you will be withdrawing that amount in eighteen years (it will be a cash inflow). Now move to PV and press Blastoff ENTER and y'all will see that yous demand to invest $25,024.ninety today in club to meet your goal. That is a lot of coin to invest all at in one case, but we'll see on the next page that you tin lessen the pain by investing smaller amounts each year.

Example 1.2 — Solving for the Number of Periods

Sometimes you lot know how much money you have now, and how much y'all demand to have at an undetermined hereafter time period. If y'all know the interest rate, then nosotros can solve for the amount of time that it volition take for the nowadays value to abound to the future value by solving for N.

Suppose that you lot have $i,250 today and you lot would like to know how long it volition take yous double your money to $2,500. Presume that you can earn 9% per year on your investment.

This is the archetype type of trouble that nosotros can quickly guess using the Rule of 72. However, we can easily find the exact answer using the TI 84 Plus calculator. Enter nine into I%, -1250 into PV, and 2500 into FV. Now scroll up to North and press Blastoff ENTER and you will see that it will take eight.04 years for your money to double.

Ane important thing to annotation is that y'all admittedly must enter your numbers according to the greenbacks flow sign convention. If you don't make either the PV or FV a negative number (and the other one positive), then you will get ERR: DOMAIN on the screen instead of the answer. That is because, if both numbers are positive, the calculator thinks that you are getting a benefit without making whatever investment. If you get this error, just press 2 (Goto) to render to the TVM Solver and and then fix the problem past irresolute the sign of either PV or FV.

Instance 1.3 — Solving for the Involvement Charge per unit

Solving for the interest rate is quite common. Maybe y'all take recently sold an investment and would like to know what your compound average almanac charge per unit of return was. Or, perchance you are thinking of making an investment and you would like to know what rate of return you demand to earn to reach a certain futurity value. Permit'due south return to our college savings problem from to a higher place, but we'll change it slightly.

Suppose that you are planning to send your daughter to college in xviii years. Furthermore, assume that y'all have adamant that you volition need $100,000 at that time in order to pay for tuition, room and lath, political party supplies, etc. If you have $20,000 to invest today, what compound average annual rate of return practice you need to earn in guild to attain your goal?

Every bit before, nosotros need to be careful when entering the PV and FV into the estimator. In this case, yous are going to invest $20,000 today (a greenbacks outflow) and receive $100,000 in 18 years (a cash inflow). Therefore, we will enter -twenty,000 into PV, and 100,000 into FV. Type 18 into N, and and so solve forI% to notice that you lot demand to earn an average of 9.35% per year. If you get ERR: NO SIGN CHNG instead of an respond, it is because yous didn't follow the cash flow sign convention. Printing 2 to return to the TVM Solver and gear up the trouble.

Note that in our original problem we assumed that y'all would earn eight% per twelvemonth, and establish that you would need to invest well-nigh $25,000 to achieve your goal. In this case, though, we assumed that you lot started with only $xx,000. Therefore, in order to reach the same goal, y'all would demand to earn a higher interest rate.

When you have solved a problem, always be sure to give the answer a second look and be sure that it seems probable to be correct. This requires that y'all sympathize the calculations that the calculator is doing and the relationships betwixt the variables. If you don't, you lot will quickly learn that if yous enter wrong numbers you will become wrong answers. Remember, the estimator simply knows what you tell information technology, it doesn't know what you really meant.

Delight go on on to part 2 of this tutorial to acquire about using the TI 84 Plus to solve problems involving annuities and perpetuities.