Cheat Sheet 2, Study notes of Quantitative Techniques

Download Cheat Sheet 2 and more Study notes Quantitative Techniques in PDF only on Docsity! Cheat Sheet 2 Math 141 Let A = accumulated balance after Y years P = starting principal APR = annual percentage rate (as a decimal) n = number of compounding periods per year Y = number of years (may be a fraction) PMT = regular payment (deposit) amount a = inflation rate (a decimal) i = interest rate (a decimal) Simple Interest Formula: A = P ∗ (1 + APR ∗ Y ) Compound Interest Formula: A = P (1 + APR n )nY Annual Percentage Yield: APY APY = (1 + APR n )n − 1 Continuous Compounding Formula: A = P ∗ eAPR∗Y Savings Plan Formula: A = PMT ∗ [(1+APR n )nY −1] APR n Total and Annual Return: totalreturn = A−P P annualreturn = ( A P )(1/Y ) − 1 Current Yield of a Bond: current yield = annual interest payment current price of bond Loan Payment Formula: PMT = P ∗ APR n[ 1−(1+APR n ) (−nY ) ] The CPI Formula CPIX CPIY = priceX priceY The Present Value of a principal P, Y years into the future, r=APR, a=annual inflation: A = P ∗ [ 1+r 1+a ]Y Real Growth g: g = r−a 1+a Real Growth over Y years: g(Y ) = [1 + r−a 1+a ]Y − 1 1