wilslm

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