Question

How to calculate the maturity of a bond

total period is 20 ( 10 years semi-annully)

market rate is 10%

FV [216,127.29, 3P, 10%] = $240,000

216,127.29 is at 17 periods

how to calculate to lead to 240,000 on financial calculator

how to calculate on financial calculator

Answer 1

• Press N and 3 (for 3 years' holding period)
• Press I/YR and 5% (for the interest rate of 5 percent)
• Press PV and -216,127.29

Take note that you need to set the investment's present value as a negative number so that you can correctly calculate positive future cash flows. If you forget to add the "minus" sign, your future value will show as a negative number.

Press PMT and PMT (there are no payments beyond the first one)

Press FV, which returns the answer of $240000