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Dear Sir
Is it possible to solve for R using financial calculator?
Take R as the coupon rate, such that:
($R x 1·0220–1) + ($R x 1·0251–2) + ($R x 1·0284–3) + ($R x 1·0325–4) + ($R x 1·0362–5) + ($100 x 1·0362–5) =
$100
4·5665R + 83·71 = 100
R = $3·57Note: the “-1” should be “power of negative 1” etc. Subscript not allowed in this posting.
thanks
It depends on what functions your calculator has. However it is a scientific calculator that you really should have, not a financial calculator.
It seems that you understand what the workings are from what you have typed.
Yes, you are right. Texas Instrument TI30xs that is used in ACCA Computer-based exam is a scientific and not financial calculator.
I don’t know how to get from this:
($R / 1·0220^1) + ($R / 1·0251^2) + ($R / 1·0284^3) + ($R / 1·0325^4) + ($R / 1·0362^5) + ($100 / 1·0362^5) = $100to…
4·5665R + 83·71 = 100
R = $3·57Should I use a scientific calculator or just math workings to solve this?
Thank you in advance.
R / 1.0220^1 = R x 1/1.0220 = R x 0.9785
R / 1.0251^2 = R x 1/1.0251^2 = R x 0.9516
R / 1.0284^3 = R x 1/1.0284^3 = R x 0.9194
Do the same for all of them, add up all the terms with R in them and then you get to the answer you typed above 🙂
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