I'm sure i'm not the only one having trouble with this topic more than anything. Its not applying the formula which is tough, its deciding which formula to apply!
I've got these strategies (they may be wrong, confirming would be nice
):
- If a small amount of money is given, it usually means FUTURE VALUE of an annuity
- If a large amount is given, but you want to find the monthly deposits, it means PRESENT VALUE while dividing (instead of multiplying) the large amount given with the ((crap)) over ((crap)) ... and so on
- If it is a single investment, then you use COMPOUND INTEREST formula
and lastly.... not really a strategy, just something i noticed:
- If you've done a calculation with a PRESENT OR FUTURE VALUE, and there is another section immediately after (for example, 1b then 1c), and its asking you to do a similar task.. chances are, as I found out... its COMPOUNT INTEREST
Share more strategies here of identifying which formula to use please
I've got these strategies (they may be wrong, confirming would be nice
):- If a small amount of money is given, it usually means FUTURE VALUE of an annuity
- If a large amount is given, but you want to find the monthly deposits, it means PRESENT VALUE while dividing (instead of multiplying) the large amount given with the ((crap)) over ((crap)) ... and so on
- If it is a single investment, then you use COMPOUND INTEREST formula
and lastly.... not really a strategy, just something i noticed:
- If you've done a calculation with a PRESENT OR FUTURE VALUE, and there is another section immediately after (for example, 1b then 1c), and its asking you to do a similar task.. chances are, as I found out... its COMPOUNT INTEREST
Share more strategies here of identifying which formula to use please