Last reviewed: 2026-05-23
CFA TVM calculator practice
TVM questions are where many CFA candidates discover the gap between knowing the formula and operating the calculator cleanly. Charterly helps you practice both: the finance setup and the calculator workflow.
The TVM loop to practice
- Identify the unknown:
N,I/Y,PV,PMT, orFV. - Set payment mode: END for ordinary annuities, BGN only when the prompt says payments are at the beginning.
- Confirm periods per year and compounding periods.
- Enter cash outflows and inflows with consistent signs.
- Compute the unknown.
- Ask whether the sign and magnitude make economic sense.
Core formulas worth keeping visible
| Task | Formula |
|---|---|
| Single-sum FV | FV = PV x (1 + r)^N |
| Single-sum PV | PV = FV / (1 + r)^N |
| Ordinary-annuity FV | FV = PMT x (((1 + r)^N - 1) / r) |
| Ordinary-annuity PV | PV = PMT x ((1 - (1 + r)^(-N)) / r) |
The calculator handles the arithmetic. The candidate still has to map the prompt into the right registers.
Worked example
Prompt: Invest 1,000 for three years at 8% annually. Find future value.
Formula:
FV = 1,000 x (1.08)^3 = 1,259.712
Displayed answer:
1,259.71
In calculator-sign terms, if the investment today is an outflow, enter PV = -1000, I/Y = 8, N = 3, PMT = 0, and compute FV = 1259.71.
Common TVM mistakes
| Mistake | How it shows up |
|---|---|
| BGN mode left on | Annuity answers are one period too large or too small. |
| P/Y or C/Y not reset | Annual prompts behave like monthly prompts. |
| Old TVM register | One hidden value survives from the previous question. |
| Sign convention reversed | The magnitude may be right, but the sign or compute path is wrong. |
| Decimal display too narrow | Rounding hides a small but exam-relevant difference. |
Read the full calculator mistake checklist
BA II Plus and HP 12C practice paths
Use the device you plan to use while studying. If you are on BA II Plus-style workflows, focus on setup and worksheet clearing. If you are on HP 12C-style workflows, focus on the RPN stack and sign discipline.
Where TVM appears beyond basic time value
TVM is not isolated. It shows up in bond pricing, yield to maturity, amortization, annuities, pension-style setups, and implied-rate questions.
Practice bond price and yield on a calculator
Frequently asked questions
Should I enter PV as positive or negative? Use signs to represent cash-flow direction. If money leaves you today, enter PV as negative and the future inflow will usually compute positive.
When should BGN mode be on? Only when payments occur at the beginning of each period. Most ordinary-annuity prompts use END mode.
Do I need both formula and calculator practice? Yes. The formula tells you what problem you are solving. Calculator practice makes the register mapping and keystrokes automatic.
Can I practice TVM without signup? Yes. The calculator and capped drills are free to start.
Where should I go after TVM? Move to NPV/IRR and bond-yield workflows, because they reuse the same sign and rate discipline.