I just brought a finanical calculator and i don't really know how to use it yet. The textbook said to calculate the price of the bond:

Price=Coupon x Annuity factor (r, T)+ Par Value x PV factor (r, T)

I was just wondering how to punch in the annuity factor and PV factor parts into the calculator? What is the button on the financial calculator?

thanks.

To calculate the annuity factor (also known as the present value of an annuity), you will need to use the appropriate function on your financial calculator. The specific button or key may vary depending on the brand and model of your calculator, but it is typically labeled "PV" or "PV of Annuity."

Here's a step-by-step guide on how to calculate the annuity factor using a financial calculator:

1. Identify the variables you need:
- Coupon: The periodic payment received from the bond.
- r: The interest rate per period.
- T: The total number of periods.

2. Enter the variables into your calculator in the following order:
- N: Enter the total number of periods (T).
- I/Y: Enter the interest rate per period (r).
- PMT: Enter the coupon payment (Coupon).
- FV: Enter 0 (zero) if the annuity terminates at the end of the last period, or enter the value if it continues beyond the last period.

3. Press the "PV" or "PV of Annuity" button to calculate the present value of the annuity.

To calculate the PV factor (also known as the present value of a single cash flow), the process is quite similar. The specific button or key on your calculator may be labeled "PV" or "Present Value."

Here's a step-by-step guide on how to calculate the PV factor using a financial calculator:

1. Identify the variables you need:
- Par Value: The future value or face value of the bond.
- r: The interest rate per period.
- T: The total number of periods.

2. Enter the variables into your calculator in the following order:
- N: Enter the total number of periods (T).
- I/Y: Enter the interest rate per period (r).
- PMT: Enter 0 (since there are no periodic payments).
- FV: Enter the future value or face value of the bond (Par Value).

3. Press the "PV" or "Present Value" button to calculate the present value of the single cash flow.

Remember, the specific button labels and order may vary depending on the calculator model, so it's always a good idea to consult the user manual for your specific calculator.