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Hewlett-Packard 10B Tutorial

To begin, look at the face of the calculator.  Every key (except one, the gold shift key) on the 10B has two
functions:  each key's primary function is noted in white on the key itself, while each key's secondary
function is noted in gold above the key.  To use the function on the key, simply press the key.  To access
the gold function above each key, first press the key with the solid gold face, which we will call the "gold
shift" key, and then press the desired function key.  (Note that the gold shift key is near the lower left corner
of the calculator keyboard.)

Turning the Calculator On and Off

To turn on the calculator, press 

.

C

Note that the ON key is on the lower left corner of the keyboard—the face of the key has a white "C,"
while the word "ON" appears below the key.  Also, we will designate keys throughout this tutorial by the
use of small boxes, as above.  To conserve the battery, the calculator turns itself off about 10 minutes after
your last keystroke.

To turn the calculator off, press 

 

.

OFF

Here we are using the solid black square to represent the gold shift key.  Thus, the keystrokes to turn the
calculator off are (1) press the gold shift key, and (2) then press the C key.  Note that the word "OFF"
appears above the C key in gold.  Thus, by pressing the gold shift key first, we are activating the gold
function above the C key, which is the off function.  Also, note that pressing the gold shift key places a little
"up arrow" symbol in the lower left corner of the display.  Press the gold shift key again and the symbol

goes away.  The 

 key is a toggle key that switches back and forth between the “regular” and the “gold”

functions.  

 is like the typewriter shift key.  After you press 

, look only at gold writing.  In this tutorial,

whenever you see 

, the label on the next key is the gold label above the key, not the label on the key

itself.

Note that the calculator has a continuous memory, so turning it off does not affect any data stored in the
calculator.

Clearing the Calculator

To clear the calculator’s memory, press 

 

.

CLEAR ALL

Summary of Contents for 10B

Page 1: ...lator turns itself off about 10 minutes after your last keystroke To turn the calculator off press OFF Here we are using the solid black square to represent the gold shift key Thus the keystrokes to turnthe calculator off are 1 press the gold shift key and 2 then press the C key Note that the word OFF appears above the C key in gold Thus by pressing the gold shift key first we are activating the g...

Page 2: ...you made a mistake entering data Changing the Display Enter 5555 5555 To change the number of decimal places from 2 to 4 press 5 555 5555 is displayed DISP 4 To change from 4 places to 2 press 5 555 56 is displayed Rounding is automatic DISP 2 We usually set the display to 2 places which is especially convenient when working with dollars and percentages However we often use 4 places whendealingwit...

Page 3: ...Hewlett Packard 10B Tutorial Page 3 ...

Page 4: ...irm this setting press and hold Unless needed for other work we generally leave the calculator setting at 1 period per year CLEAR ALL Time Value of Money TVM The TVM keys are located on the top row of the keyboard N I YR PV PMT FV In general TVM problems involve four variables three are known and the fourth is unknown Lump Sums To begin we consider TVM calculations withsingle lump sums In this sit...

Page 5: ...e must be entered as negative and the other as positive Example 2 What is the PV of 500 due in 5 years if the interest rate is 10 percent Clear first and then enter the following data 5 N 10 I YR 0 Optional if registers are cleared PMT 500 FV Pressing the key reveals that 310 46 will grow to 500 in 5 years at a 10 percent rate PV Example 3 Assume a bond can be purchased today for 200 It will retur...

Page 6: ...press to get 8 98 percent If you pay more PV I YR for the bond you earn less on it The important thing though is that you can do what if analyses with the calculator Nowdo nothingexcept to turn off the calculator Then turn on the calculator The display OFF C shows0 00 Isthememoryerased Notcompletely Whatwasonthescreenisgone but press RCL N to get N 14 The other memory registers also retain informa...

Page 7: ...t is shifted back one period To analyze annuities due press The word begin appears on the screen Now the HP analyzes the cash flows based on BEG END beginning of period payments Change back to end mode by pressing BEG END Interest Conversion The following equation is used to convert a nominal rate to an effective rate Given kNom 10 and m 12 payments year However it s much easier to convert the nom...

Page 8: ...next entry hold down CFj keyto see what it says By CFj holding down CFj key you see that you just entered CF2 100 CFj 150 CFj 200 CFj The CFs from the time line are entered Now enter the interest rate 10 I YR At this point the HP knows the cash flows the number of periods and the interest rate To find the PV press to get PV NPV 377 40 NPV Example 2 Embedded Annuities We have these cash flows which...

Page 9: ...anged 0 CFj 100 CFj 3 Nj 200 CFj 2 Nj 300 CFj 4 Nj Now the HP knows the cash flows Thus enter the interest rate 10 I YR Now press to get PV NPV 1 099 94 NPV To check your entries 0 to see CF0 RCL to see first CF entry RCL CFj to see how many times CF1 is repeated etc RCL Nj ...

Page 10: ...d by an Investment IRR 1 Assume that we invest 1 000 now t 0 and then expect to receive an uneven set of cash flows Here is the CF time line 0 1 2 3 4 3 3 3 1 1000 300 400 200 600 What rate of return will we earn Enter the following CLEAR ALL 1000 CFj 300 CFj 400 Hold down CFj key to be sure you entered CF2 CFj 200 CFj 600 CFj 16 71 IRR YR Youcanalso determine the NPVoftheinvestment Leavedataenter...

Page 11: ...ayed E Determine the mean and standard deviation by simply pressing _ _ The mean equals 168 33 x y The standard deviation is 84 01 and are sample standard Sx Sy deviations Fx and Fy refer to population statistics Linear Regression Betacoefficients can be calculated by using the HP s linear regression capabilities The X independent variable and Y dependent variable valuesmust be entered in the prop...

Page 12: ...Hewlett Packard 10B Tutorial Page 12 5 30 6 40 1 ...

Page 13: ... coefficient SWAP Amortization The HP can also be used to calculate amortization schedules Example Determine the interest and principalpaid eachyear and the balance at the end ofeach year on a three year 1 000 amortizing loan which carries an interest rate of 10 percent The payments are due annually First check payments year and be sure it s 1 Now perform the following steps CLEAR ALL 3 N 10 I YR ...

Page 14: ... into a table as 100 00 Hold down to see Prin release to see 302 11 This is the repayment ofprincipal in the first year Write it in the table Hold down to see Bal release to see 697 89 the endingbalance at the end of the first year Write it down PEr 2 2 is displayed AMORT 69 79 is the interest paid in Year 2 332 32 is the principal paid in Year 2 365 57 is the ending balance at end of Year 2 PEr 3...

Page 15: ...ayed INPUT AMORT Hold down to see Int thenreleaseand 206 35 displayed Thisisthetotalinterest paid over Years 1 to 3 Hold down to see Prin then release and 999 98 is displayed This is the total repayment of principal over Years 1 to 3 Hold down to see Bal then release and 0 02 is displayed This is the remaining balance ...

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