CFA CFA General Finding Net Present Value from Career Earnings

Finding Net Present Value from Career Earnings

  • This topic has 1 reply, 2 voices, and was last updated Sep-18 by Stuj79.
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  • Fenix26
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    Hi everyone,

    I’m currently working on a project where I am to find the net present value of a hypothetical career earnings. I figured out how to do it on excel, but I need to be able to do it on the BA II Plus calculator.
    The situation goes like this…

    An employee gets a lump sum salary at the end of each year. The employee’s salary increases 5% each year, and his current salary is $75,000. He has a tax rate of 30%. He plans to retire after 30 years of work.

    Thanks!!

    Stuj79
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    You can use the cash flow function on a BA II calculator, although you may have to enter each year’s salary individually saying as it changes by inflation each year.

    Heres a vid to show you how to use it:

    https://m.youtube.com/watch?v=TTyp78GKrdU

    Just make sure you input the after tax, inflation adjusted earnings  each year in the cash flow worksheet.

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