# TVM Problem solving the end amount.

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1. Oct 30, 2007

### cjp88

[SOLVED] TVM Problem solving the end amount.

1. The problem statement, all variables and given/known data

2. A spreadsheet software or TVM solver on a calculator can be used to determine the equal monthly payments that can be paid from an annuity for a set length of time. You can enter different payments until you find the one that gives a closing balance of less than $1 after the set length of time. What monthly payment can be paid from an annuity of$100 000 earning 6.5% per annum, compounded monthly, with a life of 10 years?

2. Relevant equations

TVM Solver:

N = (Number of payment periods)
I% = (Annual Interest rate)
PV = (Present value)
PMT = (Payment, must be -number)
FV = (Future value)
P/Y = (Payment periods per year)
C/Y = (Compounding periods per year)

3. The attempt at a solution

I did this question in Excel and got under $1, however I'm trying to send this answer with work from Excel done and TVM so I understand both ways to do this question. I'll show my excel file in an attachment. In the TVM solver I'm using on my TI-83 Plus I cannot seem to get the same results. N = 120.00 I% = 6.50 PV = 100000.00 PMT = -1344.89 FV = (To be solved) P/Y = 12.00 C/Y = 12.00 When solved, FV = 35265.34 (Which is wrong.) In my excel file, the answer should be$0.24 after the 10 years (120 months).

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2. Nov 2, 2007

### cjp88

The problem has been solved. I mis-understood the question when doing the TVM Solver.

I was supposed to put 0 for FV, not what I got from my Excel answer, then use the solve for PMT.