bingbingliang

janakisri Wrote:
-------------------------------------------------------
> I think the difference is , if you do it the first
> way i.e. PV=$1 , you don't need to add anything.
>
> For example if the original mortgage rate is 9% ,
> then I/Y=9/12 and N=300.
>
> If you do it with PV=$1 and FV=0 , then you get
> the annualized rate straightaway out of your
> calculator as 0.008392*12 = 10.07
>
> If you do it the way CPK suggests , with PV=$0 ,
> then you get it is two steps:
>
> First 0.0008917 * 12 = .0107
> The 0.09+0.0107 = 10.07
>
> So CFAI way ( i.e. TestTrac solution way ) is one
> step , while the other is two steps


whao! this is splendid, I learnt this cold from the 2 stage, now which ever way I work it, I will score this, I will just take the higher one -) Thanks everyone