2.7 Using Software to Calculate Interest Factors
The interest factors listed in Table 2.2 are not necessarily complex, but they can be tedious, especially when a hand-held calculator is being used to compute the interest factors. Programmable calculators make this calculation easier by allowing the user to program the interest factors and recalling them with the push of a button.
Various software packages allow programming for quick recall and calculation of the interest factors. In Engineering Equation Solver (EES), the user can write 'functions' and 'subroutines'. Functions are particularly helpful because the function call can be made directly in any EES statement in the Equation Window. For example, a function to calculate the Single Payment Compound Amount factor might look something like this,
FUNCTION F\P(i, n)
F\P = (1 + i)^n
Notice that in this function, the backslach (\) is used instead of the forward slash (/) since the forward slash is a division operation. This simple function can now be called within an EES program. For example,
F = P*F\P(i,n)
where the values of P, i, and n are defined somewhere in the Equation Window.
In spreadsheet programs, like MicroSoft Excel, users can write their own functions using the Visual Basic interface. These functions can then be called in any cell within the spreadsheet. Some spreadsheet programs may even have some of the discrete interest factors in Table 2.2 already available as functions. If you use these built-in functions, it would be good to compare the results to a few hand-calculations to ensure the right interest factor is being used.