Formulas

Chapter 4 Mathematics of Merchandising

N = L(1 d)
N = L(1 d
1
)(1 d
2
)(1 d
3
)
Amount of discount = L - N
Trade discount rate = amount of discount *100
L
S = C + M
M = E +
S = C + E +
!ate of mar"u# on cost = M*100

C

!ate of mar"u# on se$$in% #rice = M*100

S
!ate of mar"do&n = amount of mar"do&n *100

S
Chapter 6 - Simple Interest
t I r
) 1 ( rt P S +
) 1 ( rt
S
P
+

or
1
) 1 (

+ rt S P

I = S - P
Chapter 8 Compound Interest: Future Value and Present Value
FV = PV(1 + i)
n
PV = '((1 + i)
-n
Chapter Compound Interest: Further !opics and "pplications

) 1 $n(
$n
i
PV
FV
n
+

,
_

1
1

,
_

n
PV
FV
i

effective rate of interest:
1 ) 1 ( +
m
i f
where m is the number of compounding periods in a year
Chapter #$ "nnuities: Future Value and Present Value

( )
1
]
1

i
i
P! FV
n
1 1 ( )
1
]
1

i
i
P! PV
n
1 1
"enera# annuities:
c $ number of compounding periods per year
1 ) 1 (
)
+
c
i i
number of payment periods per year

( )
1
1
]
1

)
)
1 1
i
i
P! FV
n
( )
1
1
]
1

)
)
1 1
i
i
P! PV
n
%nnuities due:
( )
1
]
1

i
i
P! FV
n
1 1
(1 & i)
( )
1
]
1

i
i
P! PV
n
1 1
(1 & i'
"enera# %nnuities due:

( )
1
1
]
1

)
)
1 1
i
i
P! FV
n
(1 & i
2
'
( )
1
1
]
1

)
)
1 1
i
i
P! PV
n
(1 & i
2
'
Chapter ## "nnuities: Periodic Pa%ment& 'um(er of Pa%ments&
and Interest )ate
) 1 $n(
1 $n
i
P!
FV i
n
+

,
_

) 1 $n(
1 $n
i
P!
PV i
n
+

,
_

) 1 $n(
) 1 (
) (
1 $n
i
i P!
due FV i
n
+

,
_

) 1 $n(
) 1 (
) (
1 $n
i
i P!
due PV i
n
+

,
_

%nnuities due:
( )
1
]
1

i
i
P! FV
n
1 1
(1 & i)
( )
1
]
1

i
i
P! PV
n
1 1
(1 & i'
%nnuities due (comp#e)':

( )
1
1
]
1

)
)
1 1
i
i
P! FV
n
(1 & i
2
'
( )
1
1
]
1

)
)
1 1
i
i
P! PV
n
(1 & i
2
'