LIBRARY OF 
 
 ALLEN KNIGHT 
 
 CERTIFIED PUBLIC ACCOUNTANT 
 
 502 California Street 
 
 SAN FRANCISCO. CALIFORNIA 
 
m MEMQR.IANI 
 
Digitized by the Internet Archive 
 
 in 2007 with funding from 
 
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 http://www.archive.org/details/accountanctyofinOOsprarich 
 
THE ACCOUNTANCY OF 
 INVESTMENT 
 
 BY 
 
 Charles Ezra Sprague, a.m., Ph.d., Litt.d., c.p.a. 
 
 Late Professor of Accountancy in New York University ; 
 Late President of Union Dime Savings Bank, New York Ctty 
 
 With which are incorporated "Logarithms to 12 Places 
 
 and Their Use in Interest Calculations" and 
 
 "Amortization" by the same author 
 
 REVISED BY 
 
 LEROY L. PeRRINE, Ph.B., B.C.S., C.P.A. 
 
 Lecturer on Accounting at the Nexv York University School 
 of Commerce, Accounts and Finance; Meynber of the 
 staff of Haskins &> Sells, Certified Public AccountaMis 
 
 RONALD ACCOUNTING SERIES 
 
 NEW YORK 
 
 THE RONALD PRESS COMPANY 
 1914 
 

 Copyright, 1904, by Charles E. Sprague 
 
 Copyright, 1905, by Charles E. Sprague 
 
 Copyright, 1907, by Charles E. Sprague 
 
 Copyright, 1909, by Charles E. Sprague 
 
 Copyright, 1910, by Charles E. Sprague 
 
 Copyright, 1914, 
 
 by 
 
 THE RONALD PRESS COMPANY 
 
 
(Sjenjeral SMtmmt oi ^laxiaxml §0arir 
 
 Applicable to all books of the 
 Ronald Accounting Series 
 
 THE manuscripts of the books forming the 
 Ronald Accounting Series have been sub- 
 mitted to us and have been approved by us for 
 publication. 
 
 In some cases the authors express views that 
 are not fully in accord with those entertained by 
 us, but in no instance are such differences of 
 sufficient importance, in our judgment, to warrant 
 the withholding from publication of a meritorious 
 work. 
 
 J. E. Sterrett 
 
 Robert H. Montgomery 
 
PREFACE 
 
 Among the published works of the late Colonel Sprague, 
 there are four which deal particularly with certain mathe- 
 matical phases of accounting, viz. : *Text Book of the Ac- 
 countancy of Investment" ; "Amortization" ; "Logarithms to 
 12 Places and Their Use in Interest Calculations"; and 
 "Extended Bond Tables." Since the author's death in 
 March, 1912, it has become desirable to combine the first 
 three of these publications into one volume, in order to 
 serve more effectively the needs of business men and students 
 of accounting by presenting the material in compact and 
 convenient form. 
 
 The present volume is the result of this consolidation. In 
 it has been incorporated everything of practical value con- 
 tained in the three works mentioned, while at the same time 
 the special features of those books have been amplified by 
 additional text matter and problems, wherever such addi- 
 tions have seemed desirable for the sake of more adequate 
 treatment. 
 
 In conformity with the usual and commendable practice 
 of Colonel Sprague, the reviser has avoided as far as pos- 
 sible the use of the more difficult mathematical demonstra- 
 tions and formulas, believing that thereby the book will 
 prove of greater utility to practicing accountants, bankers, 
 and other business men. On this point we quote from the 
 author's original preface : "Treatises on this subject (Mathe- 
 matics of Investment), written for actuarial students, are 
 invariably too difficult, except for those who have not only 
 been highly trained in algebra, but are fresh in its use, and 
 this makes the subject forbidding to many minds. I have 
 
vi PREFACE 
 
 made all my demonstrations arithmetical and illustrative, 
 but, I think, none the less convincing and intelligible." 
 
 It is believed that for a considerable number of readers, 
 the tables of logarithms given in Part III will prove of great 
 utility in those cases where more than ordinary accuracy is 
 required, and where special tables are, at times, imperative. 
 To quote again from the preface of Colonel Sprague: 
 "Rough results will answer for approximative purposes ; but 
 where it is desirable, for instance, to construct a table of 
 amortization, sinking fund, or valuation of a lease at an 
 unusual rate, for a large amount and for a great many years, 
 exactness is desirable and becomes self-proving at the end." 
 
 A whole book is required for the ordinary tables of loga- 
 rithms of six or seven places, while the tables here presented 
 are contained in a few pages and give accurate results to 
 twelve places of decimals. The processes with these tables 
 are necessarily somewhat slower than with those of six or 
 seven places, but their use is fully justified where greater 
 accuracy in results is desirable. 
 
 The tables of compound interest, present worth, an- 
 nuities, and sinking funds, carried to eight places of decimals, 
 have been retained in this edition. Such tables are prac- 
 tically indispensable in securing accurate computations. The 
 index of subjects at the end of the book is a new feature and 
 will facilitate quick reference to any information desired. 
 
 Leroy L. Perrine. 
 New York City, January, 1914. 
 
CONTENTS 
 
 PART I— THE MATHEMATICS OF INVESTMENT 
 
 Chapter I. Capital and Revenue 
 
 • 1. Definition of Capital 
 
 2. The Use of Capital 
 
 3. Sources of Capital 
 
 4. Investment ^ 
 
 5. Revenue 
 
 6. Interest and Rent 
 
 7. Dividends 
 
 8. Laws of Interest 
 
 Chapter II. Interest 
 
 I 9. Interest 
 
 10. Essentials of Interest Contract 
 
 11. Interest Rate 
 
 12. Principal 
 
 13. Simple and Compound Interest 
 
 14. Punctual Interest 
 
 15. Computation of Interest 
 
 16. Simple Interest 
 
 17. Compound Interest 
 
 18. Computation of Compound Interest 
 
 19. Comparison of Simple and Compound Interest 
 
 20. The Day as a Time Unit 
 
 21. The Month as a, Time Unit 
 
 22. Half and Quarter Years 
 
 23. Partial Interest Periods 
 
 24. Changing the Day Basis 
 
 25. The Amount — First Period 
 
 26. The Amount — Subsequent Periods 
 
 27. Exponents and Powers 
 
 28. Finding the Amount — Compound Interest 
 
 29. Present Worth 
 
 30. Present Worth and Amount Series 
 
 31. Relation Between Present Worth and Amount 
 
iii CONTENTS 
 
 32. Formation of Series 
 
 33. Discount 
 
 34. Computing Compound Discount 
 
 35. Formulas for Interest Calculations 
 
 36. Use of Logarithms 
 
 Chapter III. The Use of Logarithms 
 
 § 37. Purpose of Logarithms 
 
 38. Exponents, Powers, and Roots 
 
 39. Logarithms as Exponents 
 
 40. Rules and Symbols of Logarithms ^ 
 
 41. The Two Parts of a Logarithm 
 
 42. Mantissa Not Affected by Position of the Decimal Point 
 
 43. Four-Place Table of Logarithms 
 
 44. Multiplication by Logarithms 
 
 45. Division by Logarithms 
 
 46. Powers by Logarithms 
 
 47. Roots by Logarithms 
 
 48. Fractional Exponents 
 
 49. Use of Logarithms in Computing Compound Interest 
 
 50. Accuracy of Logarithmic Results 
 
 51. Logarithms to Fifteen Places 
 
 52. Use of Logarithms in Present Worth Calculations 
 
 Chapter IV. Amount of an Annuity 
 
 § 53. Evaluation of a Series of Payments 
 
 54. Annuities 
 
 55. Amount of Annuity 
 
 56. Calculation of Annuity Amounts 
 
 57. Formation of Tables 
 
 58. Use of Tables 
 
 59. Compound Interest as a Base for Annuity Calculations 
 
 60. Rule and Formula for Finding Amount 
 
 61. Operation of Rule 
 
 Chapter V. Present Worth of an Annuity 
 
 § 62. Method of Calculation 
 
 63. Tables of Present Worth 
 
 64. Short Method for Finding Present Worth of an Annuity 
 
 65. Present Worth Obtained 
 
 66. Rule for Present Worth 
 
 67. Formulas for Present Worth 
 
 68. Analysis of Annuity Payments 
 
 69. Components of Annuity Instalments 
 
CONTENTS ix 
 
 70. Amortization 
 
 71. Amortization and Present Worth 
 
 72. Development of a Series of Amortizations 
 7Z. Evaluation by Logarithms 
 
 Chapter VI. Special Forms of Annuities 
 
 74. Ordinary or Immediate Annuities 
 
 75. Annuities Due 
 
 76. Present Worth of Annuities Due 
 
 77. Present Worth of Deferred Annuities 
 
 78. Rule for Finding Present Worth of Deferred Annuity 
 
 79. Present Worth of Perpetuities 
 
 80. Perpetuity in Stock Purchased for Investment 
 
 81. When Annuity Periods and Interest Periods Differ 
 
 82. Varying Annuities 
 
 Chapter VII. Rent of Annuity and Sinking Fund 
 
 83. Rent of Annuity 
 
 84. Rule for Finding Rent of Annuity 
 
 85. Alternative Method of Finding Rent 
 
 86. Rent of Deferred Payments 
 
 87. Annuities as Sinking Funds 
 
 88. Rule for Finding Sinking Fund Contributions 
 
 89. Verification Schedule 
 
 90. Amortization and Sinking Fund 
 
 Chapter VIII. Nominal and Effective Rates 
 
 91. Explanation of Terms 
 
 92. Semi-Annual and Quarterly Conversions 
 
 93. Limit of EflFective Annual Rate 
 
 94. Rule for EflFective Rate 
 
 95. Logarithmic Process 
 
 Chapter IX. Bonds and the Proper Basis of Bond Accounts 
 
 I 96. Provisions of Bonds 
 
 97. Interest on Bonds 
 
 98. Hov^r Bonds Are Designated 
 
 99. Relation of Cost to Net Income 
 
 100. Coupon and EflFective Rate of Interest on Bonds 
 
 101. Present Worth of Bonds 
 
 102. Considerations in the Purchase of Bonds 
 
 103. Present Worth and Earning Capacity of Bonds 
 
 104. Cost and Par of Bonds 
 
CONTENTS 
 
 105. Intermediate Value of Bonds 
 
 106. True Investment Basis for Bonds 
 
 107. Various Bond Values 
 
 108. Investment Value the True Accounting Basis 
 
 Chapter X. Valuation of Bonds 
 
 109. Cash Rate and Income Rate of Bonds 
 
 110. Elements of a Bond 
 
 111. Valuation of Bonds — First Method 
 
 112. (a) Finding Present Worth of Principal 
 
 113. (b) Present Worth of Coupons 
 
 114. Schedule of Evaluation 
 
 115. Valuation of Bonds — Second Method 
 
 116. Evaluation When Cash Rate Is Less Than Income Rate 
 
 117. Second Method by Schedule 
 
 118. Rule for Second Method of Evaluation 
 
 119. Principles of Investment 
 
 120. Solution by Logarithms 
 
 121. Amortization Schedule 
 
 122. Use of Schedules in Accountancy 
 
 123. Book Values in Schedules 
 
 124. Checks on Accuracy of Schedules 
 
 125. Tables Derivable from Bond Values 
 
 126. Methods of Handling Interest 
 
 127. Schedule of Bond Values 
 
 Chapter XI. Valuation of Bonds (Concluded) 
 
 128. Bond Purchases at Intermediate Dates 
 
 129. Errors in Adjusting Bond Prices 
 
 130. Schedule of Periodic Evaluation 
 
 131. Objection to Valuation on Interest Dates 
 
 132. Interpolation Method of Periodic Valuation 
 
 133. Multiplication Method of Valuation 
 
 134. Computation of Net Income for Partial Period 
 
 135. Purchase Agreements 
 
 136. Approximation Method of Finding Income Rate 
 
 137. Application of Method 
 
 138. First Method of Eliminating Residues 
 
 139. Second Method of Eliminating Residues 
 
 140. Third Method of Eliminating Residues 
 
 141. Short Terminals 
 
 142. Rule for Short Terminals 
 
 143. Discounting 
 
 144. Last Half- Year of Bond 
 
CONTENTS , xi 
 
 145. Serial Bonds 
 
 146. Irredeemable Bonds 
 
 147. Optional Redemption 
 
 148. Bonds as Trust Fund Investments 
 
 149. Payments to Life Tenant 
 
 150. Effect of Varying Rates on Investments 
 
 151. Example of Payments to Life Tenant 
 
 152. Cullen Decision 
 
 153. Cullen Decision Scheduled 
 
 154. Unjust Feature of Cullen Decision 
 
 155. Bond Tables 
 
 156. Features of the Bond Table 
 
 Chapter XII. Summary of Compound Interest Processes 
 
 § 157. Rules and Formulas 
 
 158. Rules 
 
 159. Formulas 
 
 Chapter XIII. Accounts — General Principles 
 
 § 160. Relation of General Ledger to Subordinate Ledgers 
 
 161. The Interest Account 
 
 162. Mortgage and Loan Accounts 
 
 Chapter XIV. Real Estate Mortgages 
 
 § 163. Nature of Loans on Bond and Mortgage 
 
 164. Separate Accounts for Principal and Interest 
 
 165. Interest Debits and Credits 
 
 166. Characteristics of Modern Ledger 
 
 167. The Mortgage Ledger 
 
 168. Identification of Mortgages by Number 
 
 169. The "Principal" Account 
 
 170. Special Columns for Mortgagee's Disbursements 
 
 171. The Interest Account 
 
 172. Interest Due 
 
 173. Books Auxiliary to Ledger 
 
 174. The "Due" Column 
 
 175. Interest Account Must Be Analyzed 
 
 176. Form of "Interest Due" Account 
 
 177. Forms for Mortgage Account 
 
 178. Loose-Leaf and Card Records 
 
 179. Forms of Mortgage Loan Accounts 
 
 180. Reverse Posting of Interest Register 
 
 181. Handling Receipts and Notices 
 
 182. Mortgages Account in General Ledger 
 
ii CONTENTS 
 
 183. Tabular Register 
 
 184. Equal Instalment Method 
 
 Chapter XV. Loans on Collateral 
 
 185. Short Time Loans on Personal Property 
 
 186. Forms for Loan Accounts 
 
 187. Requirements for Interest Account 
 
 188. Forms for Collateral Loan Accounts 
 
 Chapter XVI. Interest Accounts 
 
 189. Functions of the Three Interest Accounts 
 
 190. A Double Record for Interest Earned 
 
 191. Example of Interest Income 
 
 192. Daily Register of Interest Accruing 
 
 193. Monthly Summary 
 
 194. Method and Importance of Interest Earned Account 
 
 195. Interest Accounts in General Ledger 
 
 196. Payment of Accrued Interest 
 
 Chapter XVII. Bonds and Similar Securities 
 
 197. Investments with Fluctuating Values 
 
 198. Amortization Account 
 
 199. Effect on Schedule of Additional Purchases 
 
 200. The Bond Sales Account 
 
 201. Requirements as to Bond Records 
 
 202. Form of Bond Ledger 
 
 203. Interest Due Account 
 
 204. Interest Account — Bond Ledger 
 
 205. Amortization Entries 
 
 206. Bond Entries in General Ledger 
 
 207. Accounts Where Original Cost Is Disregarded 
 
 208. Amortization Reserve 
 
 209. Premiums and Amortization 
 
 210. Writing Off Premiums 
 
 211. Disposal of Amortization 
 
 212. Amortization Accounting — Comparison of Methods 
 
 213. Irredeemable Bonds a Perpetual Annuity 
 
 214. Bond Accounts for General Ledger 
 
 (Plans I to V) 
 
 Chapter XVIII. Discounted Values 
 
 215. Securities Payable at Fixed Dates Without Interest 
 
 216. Rates of Interest and Discount 
 
 217. Rate of Discount Named in Notes 
 
CONTENTS xiii 
 
 218. Form as AfiFecting Legality 
 
 219. Entry of Notes Discounted 
 
 220. Discount and Interest Entries 
 
 221. Total Earnings from Discounts 
 
 PART II— PROBLEMS AND STUDIES 
 Chapter XIX. Interest and Discount 
 
 § 222. Problems in Simple Interest 
 
 223. Notes on the One Per Cent Method 
 
 224. Answers to Problems in Simple Interest 
 
 225. Problems in Compound Interest 
 
 226. Answers to Problems in Compound Interest 
 
 227. Proof of Amount and Present Worth 
 
 228. Contracted Multiplication 
 
 229. Problems in the Use of Logarithms 
 
 230. Problems Requiring Use of More Extended Tables of 
 
 Logarithms 
 
 231. Answers to Problems in Logarithms 
 
 Chapter XX. Problems in Annuities and in Nominal and Effective 
 
 Rates 
 
 § 232. Problems in Annuities 
 
 233. Answers to Problems in Annuities 
 
 234. Problems in Rent of Annuity and Sinking Fund 
 
 235. Answers to Problems in Rent of Annuity and Sinking Fund 
 
 236. Problems in Nominal and Effective Rates 
 
 237. Answers to Problems in Nominal and Effective Rates 
 
 238. Constant Compounding 
 
 239. Finding Nominal Rate 
 
 240. Approximate Rules 
 
 Chapter XXI. Equivalent Rates of Interest— Bond Valuations 
 
 § 241. Annual and Semi-Annual Interest 
 
 242. Semi-Annual and Quarterly Interest 
 
 243. Problems in Valuation of Bonds 
 
 244. Successive Method of Bond Valuation — Problems 
 
 245. Answers to Bond Valuation Problems 
 
 246. Bond Valuations by the Use of Logarithms 
 
 247. Finding Initial Book Values 
 
 248. Tabular Multiplication and Contracted Division 
 
 249. Formation of Successive Amortizations 
 
xiv CONTENTS 
 
 250. Test by Differencing 
 
 251. Successive Columns 
 
 252. Intentional Errors 
 
 253. Rejected Decimals 
 
 254. Limit of Tolerance 
 
 Chapter XXII. Broken Initial and Short Terminal Bonds 
 
 § 255. Problems in Valuation 
 
 256. Answers to Valuation Problems 
 
 Chapter XXIII. The Use of Tables in Determining the Accurate 
 
 Income Rate 
 
 § 257. Bond Tables as Annuity Tables 
 
 258. Premium and Discount as a Present Worth 
 
 259. Present Worth by Differences 
 
 260. Present Worth by Division 
 
 261. Compound Discount and Present Value of a Single Sum 
 
 262. Use of Bond Tables in Compound Interest Problems 
 
 263. Determination of Accurate Income Rate 
 
 264. Assumed Trial Rate 
 
 265. Application of Assumed Trial Rate — Bond Above Par 
 
 266. Variations in Assumed Rates 
 
 267. Application of Assumed Trial Rate — Bond Below Par 
 
 268. Trial Rates from Bond Tables 
 
 269. Use of Bond Tables 
 
 Chapter XXIV. Discounting 
 
 § 270. Table of Multiples 
 
 271. Present Worths of Interest-Difference 
 
 272. Discounts from Tables 
 
 273. Reussner's Tables 
 
 Chapter XXV. Serial Bonds 
 
 § 274. Problem in Valuation of Serial Bonds 
 
 275. Inter-rates 
 
 276. Table of Differences 
 
 277. Successive Method 
 
 278. Balancing Period 
 
 279. First Payment in Series 
 
 280. Elimination of Residue 
 
 281. Schedule 
 
 282. Uneven Loans 
 
 283. Tabular Methods 
 
CONTENTS XV 
 
 284. Formula for Serials 
 
 285. Problems in Valuation of Serial Bonds 
 
 286. Answers to Problems in Valuation of Serial Bonds 
 
 Chapter XXVI. Option of Redemption 
 
 287. Method of Calculating Income Rate 
 
 288. Advantageous Redemption Ignored 
 
 289. Disadvantageous Redemption Expected 
 
 290. Change in Principal 
 
 291. Approximate Location 
 
 292. Problems Involving Optional Redemption Dates 
 
 293. Rule for Determining Net Income 
 
 294. Answers to Problems Involving Optional Redemption Dates 
 
 Chapter XXVII. Bonds at Annual and Other Rates 
 
 295. Standard of Interest 
 
 296. Semi-Annual and Quarterly Coupons 
 
 297. Shifting of Income Basis 
 
 298. Problems — Bonds at Varying Rates 
 
 299. Answers to Problems — Bonds at Varying Rates 
 
 300. Bonds with Annual Interest — Semi-Annual Basis 
 
 301. Annualization 
 
 302. , Semi-Annual Income Annualized 
 
 303. Comparison of Annual and Semi-Annual Bonds 
 
 304. Finding Present Worth of an Annuity 
 
 305. Rule for Bond Valuation 
 
 306. Multipliers for Annualizing 
 
 307. Formula for Annualizer 
 
 308. Conventional Process 
 
 309. Scientific Process 
 
 310. Values Derived from Tables 
 
 311. Successive Process 
 
 312. Problems and Answers — Varying Time Basis 
 
 313. Bonds at Two Successive Rates 
 
 314. Calculation of Immediate Premium 
 
 315. Calculation of Deferred Premium 
 
 316. Symbols and Rule 
 
 317. Analysis of Premiums 
 
 318. Problems and Answers — Successive Rates 
 
 Chapter XXVIII. Repayment and Reinvestment 
 
 319. Aspects of Periodic Payment 
 
 320. Integration of Original Debt 
 
 321. Use of the Reinvestment Point of View 
 
 322. Replacement 
 
xvi CONTENTS 
 
 323. Diminishing Interest Rates 
 
 324. Proof of Accuracy 
 
 325. Varying Rates of Interest 
 
 326. Dual Rate for Income and Accumulation 
 
 327. Instalment at Two Rates 
 
 328. Amortization of Premiums at Dual Rate 
 
 329. Modified Method for Valuing Premiums 
 
 330. Rule for Valuation of a Premium 
 
 331. Computation at Dual Rate 
 
 332. Dual Rate in Bookkeeping 
 
 333. Utilization of Dual Principle 
 
 334. Installation of Amortization Accounts 
 
 335. Scope of Calculations 
 
 336. Method of Procedure When Same Basis Is Retained 
 
 PART III— LOGARITHMS 
 Chapter XXIX. Finding a Number When Its Logarithm Is Given 
 
 § 2Z7. Logarithmic Tables 
 
 338. Discussion of Logarithms 
 
 339. Standard Tables of Logarithms 
 
 340. United States Coast Survey Tables 
 34L Gray and Steinhauser Tables 
 
 342. A Twelve-Place Table 
 
 343. The "Factoring" Method 
 
 344. Finding a Number from Its Logarithm 
 
 345. Procedure in an Unusual Case 
 
 346. Rule for Finding Number When Logarithm Is Given 
 
 347. Method by Multiples 
 
 Chapter XXX. Forming Logarithms; Tables 
 
 § 348. Explanation of Process 
 
 349. Rule for Finding a Logarithm 
 
 350. Examples of Logarithmic Computations 
 
 351. Logarithms to Less Than Twelve Places 
 
 352. Tables with More Than Twelve Places 
 
 353. Multiplying Up 
 
 354. Process of Multiplying Up 
 
 355. Supplementary Multiplication 
 
 356. Multiplying Up by Little's Table 
 
 357. Different Bases 
 
 358. Table of Factors 
 
 359. Table of Interest Ratios 
 
CONTENTS xvii 
 
 360. Table of Sub-Reciprocals 
 
 361. Table of Multiples 
 
 PART IV— TABLES 
 Chapter XXXI. Explanation of Tables Used 
 
 § 362. Object of the Tables 
 
 363. Degree of Accuracy 
 
 364. Rates and Periods 
 
 365. Tables Shown 
 
 366. Annuities — When Payable 
 
 367. Table I— Amount 
 
 368. Compound Interest 
 
 369. Table II— Present Worth 
 
 370. Table III— Amount of Annuity 
 
 371. Table IV— Present Worth of Annuity 
 
 372. Table V— Sinking Fund 
 
 373. Rent of Annuity 
 
 374. Extension of Time 
 
 375. Subdivision of Rates 
 
 376. Interpolation 
 
 377. Table VI — Reciprocals and Square Roots 
 
 Chapter XXXII. Tables of Compound Interest, Present Worth, 
 Annuities, Sinking Funds, and Other Computations 
 
 § 378. Table I — Amount of $1 at Compound Interest 
 
 (a) Part 1 
 
 (b) Part 2 
 
 379. Table II— Present Worth of $1 at Compound Interest 
 
 (a) Part 1 
 
 (b) Part 2 
 
 380. Table III— Amount of Annuity of $1 at End of Each Period 
 
 (a) Part 1 
 
 (b) Part 2 
 
 381. Table IV— Present Worth of Annuity of $1 at End of Each 
 
 Period 
 
 (a) Part 1 
 
 (b) Part 2 
 
 382. Table V — Sinking Fund or Annuity Which, Invested at the 
 
 End of Each Period, Will Amount to $1 
 
 (a) Part 1 
 
 (b) Part 2 
 
 383. Table VI — Reciprocals and Square Roots 
 
EXPLANATION OF SYMBOLS 
 
 For the sake of brevity and clearness, certain constantly- 
 recurring expressions have been represented in the text by 
 symbols. The following list comprises all of those which are 
 not self-explanatory. 
 
 1 = $1, £l, or any other unit of value. 
 
 a = the amount of $1 for a given time at a given rate. 
 
 A = the amount of an annuity of $1 for a given time at a 
 given rate. 
 
 c = the cash, or coupon, rate of interest (or the cash pay- 
 ment) for a single period. 
 
 d = the rate of discount for a single period. 
 
 D = the discount on $1 for a given time at a given rate. 
 
 i = the rate of interest (or the income) for a single period. 
 
 I =the compound interest on $1 for a given time at a 
 given rate.. 
 
 / = the effective rate of interest for one year. 
 
 M = an indefinite number of units. 
 
 p = the present worth of $1 for a given time at a given rate. 
 
 P = the present worth of an annuity of $1 for a given time 
 at a given rate. 
 
 r = (1+ 1), the periodic ratio of increase. 
 
 xvm 
 
THE ACCOUNTANCY OF INVESTMENT 
 Part I — The Mathematics of Investment 
 
 CHAPTER I 
 
 CAPITAL AND REVENUE 
 
 § I. Definition of Capital 
 
 That portion of wealth which is set aside for the pro- 
 duction of additional wealth is capital. The capital of a 
 business, therefore, is the whole or a part of the assets of 
 the business, and of course appears on the active or debit 
 side of its balance sheet. This is the sense in which the 
 word "capital" is used in economics ; but in bookkeeping the 
 term "Capital account" is often used in quite another sense 
 to mean accounts on the credit or passive side, which denote 
 proprietorship. To prevent confusion, the use of the ex- 
 pression "Capital account" will be avoided. 
 
 § 2. The Use of Capital 
 
 In active business, capital must be employed, and, in 
 order to produce more wealth, it must be combined with 
 skill and industry. Businesses, and consequently their ac- 
 counting methods, vary as to the manner in which capital 
 is used. Cash is convertible into potential capital of any 
 kind desired. In a manufacturing business it is exchanged 
 
 ^9 
 
"20' ^'' ' ^'^^riE^MAXriEMATICS OF INVESTMENT 
 
 for machinery, appliances, raw materials, and labor which 
 transforms these raw materials into finished products. In 
 a mercantile business cash is expended for goods, bought at 
 one price to sell at another, and for collecting, displaying, 
 caring for, advertising, and delivering goods. To bridge 
 over the time between selling and collecting, additional 
 capital is required, usually known as "working capital," but 
 which might more appropriately be styled "waiting capital." 
 Thus we may analyze each kind of business, and show that 
 the nature of its capital assets depends on the character of 
 the business. 
 
 § 3. Sources of Capital 
 
 On the credit side of the balance sheet the capital must 
 be accounted for in such a manner as to show its sources. 
 Here there are two sharply divided classes : loan-csipitsl, or 
 liability, and ow^-capital, or proprietorship. The great 
 distinction is that the latter participates in the profits and 
 bears the losses, while the former takes its share irrespective 
 of the success of the concern. It is the own-capital which 
 is referred to in the phrase "Capital account." 
 
 § 4. Investment 
 
 While we often speak of a man's capital as being in- 
 vested in a business, we use the word "investment" more 
 strictly when we confine it to the non-participating sense. 
 Thus we say, "He not only owns a business, but he has 
 some investments besides." In the strictest sense, then, in- 
 vestment implies divesting one's self of the possession and 
 control of one's assets, and granting such possession and 
 control to another. The advantage of the use of capital 
 must be great enough to enable the user to earn more than 
 the sum which he pays to the investor, or capitalist. There 
 are many cases where the surrender is not absolute, and 
 
CAPITAL AND REVENUE 21 
 
 more or less risk is assumed by the investor. This is not 
 absolute investment, but to some extent partnership. The 
 essence of strict investment is the vicarious earning of a 
 share in gains which do not depend on the business skill of 
 the investor. 
 
 § 5. Revenue 
 
 All investments are made with a view to obtaining 
 revenue, which is the share of the earnings given for the 
 use of capital. Revenue takes three forms: interest, rent, 
 and dividends — the first two corresponding to strict invest- 
 ment, and the latter to participation. 
 
 §6. Interest and Rent 
 
 These do not essentially differ. Both are stipulated pay- 
 ments for the use of capital ; but in case of rent the identical 
 physical asset received by the lessee must be returned by 
 him on the completion of the contract. If you borrow a 
 dollar, you may repay any dollar you please ; if you hire a 
 house or a horse, you may not return any house or any 
 horse, but must produce the identical one you had. Interest 
 and rent are both proportionate to time. 
 
 § 7. Dividends 
 
 These are profits paid over to the owners of the own- 
 capital, whether partners or shareholders. The amount is 
 subtracted from the collective assets and paid over to the 
 separate owners. Theoretically there is neither profit nor 
 loss in this distribution. I have more cash, but my share 
 in the collective assets is exactly that much less. The cash 
 is distributed partly because it is needed by the participants 
 for consumption ; and partly because no more capital can be 
 profitably used in the enterprise. Some concerns, however, 
 such as banks, which can profitably use more capital and 
 
22 THE MATHEMATICS OF INVESTMENT 
 
 whose shareholders do not require cash for consumption, 
 frequently refrain from dividing the periodical profits, or 
 distribute but a small portion of them. 
 
 The accumulation of the profits, however, inures just as 
 surely to the benefit of the shareholders, and is usually 
 realizable through increased value of the shares upon sale. 
 Thus, dividends are not strictly revenue, though the share- 
 holder may treat them as such; his dividend may be so 
 regular as practically to be fixed, or his shares may be 
 preferential, so that to some extent he is receiving an 
 ascertained amount; or, as in case of a leased railway, the 
 dividend may be expressly stipulated in a contract. Still, 
 legally speaking, the dividend is instantaneous, and does 
 not accrue, like interest and rent. 
 
 § 8. Laws of Interest 
 
 As all investments are really purchases of revenue, and 
 as the value of an investment depends largely upon the 
 amount of revenue derivable therefrom, and as the typical 
 form of revenue is interest, it is necessary to study the laws 
 of interest, including those more complex forms — annuities, 
 sinking funds, and amortization. Although there is a 
 special branch of accountancy — ^the actuarial — which deals 
 not only with these subjects, but with life and other con- 
 tingencies, it is yet very necessary for the general accountant 
 to understand at least their fundamental principles. 
 
CHAPTER II 
 
 INTEREST 
 
 § g. Interest 
 
 As ordinarily defined, interest is "money paid for the 
 use of money." A better definition from a mathematical 
 standpoint would be, "the increase of indebtedness through 
 lapse of time." Since the production of additional wealth is 
 dependent on the processes of nature, and since these 
 processes require time, it is equitable that compensation for 
 an increase in time should be made by an increase in in- 
 debtedness. The "money paid" of the first definition is a 
 payment on account of the general debt (including in- 
 terest) ; the direct effect of interest is to increase the debt, 
 while the direct effect of a payment is to reduce it. 
 
 § 10. Essentials of Interest Contract 
 
 The contract, express or implied, regarding an interest 
 transaction, must take into consideration the following 
 items: 
 
 (1) Principal. The number of units of value (dollars, 
 pounds, francs, marks, etc.) originally loaned or invested. 
 
 (2) Rate. The part of the unit of value (usually a 
 small number of hundredths) which is added to each such 
 unit by the lapse of one unit of time. 
 
 (3) Frequency. The length of the unit of time, measured 
 in years, months, or days. Weeks are not used as time 
 units, nor are parts of a day. 
 
 (4) Time. The number of units of time during which 
 the indebtedness is to continue. 
 
 23 
 
24 
 
 THE MATHEMATICS OF INVESTMENT 
 
 §11. Interest Rate 
 
 The rate is usually spoken of as so much per cent per 
 period, or term. Thus, if the contract provides for the 
 payment of three cents each year for the use of each dollar 
 of principal, the rate may be expressed, .03 per annum, 3 
 per centum per annum, 3 per cent, or simply 3%. Where 
 the period is not a year, but a smaller unit of time, it is 
 nevertheless customary to speak of the annual rate. For 
 instance, instead of saying, "3% per half-year,'' we say, 
 "6%, payable semi-annually." In the same way, 1% per 
 quarter would be 4%, payable quarterly. In our discus- 
 sions of interest, however, we shall treat of periods, and of 
 the rate per period, in order to avoid confusion. The in- 
 terest rate will be designated by the small letter i\ as, 
 z = .06. At the end of the first period the increased in- 
 debtedness, corresponding to the original unit of indebted- 
 ness at the beginning of the term, is 1 + i (1.06), a very- 
 important quantity in computation. The subject of rates 
 of interest will be discussed in greater detail in Chapter 
 VIII, "Nominal and Effective Rates."* 
 
 § 12. Principal 
 
 Since each dollar increases just as much as every other 
 dollar, the general practice is to consider the principal as 
 one dollar and, when the proper interest thereon has been 
 found, to multiply it by the number of dollars. 
 
 § 13. Simple and Compound Interest 
 
 Interest is assumed to be paid when due. If it is not 
 so paid, it ought to be added to the principal, and interest 
 should be computed on the increased principal. But the 
 law does not directly sanction this compounding of interest, 
 
 *For discussion of the causes of higher or lower interest rates, see "The Rate 
 of Interest," by Prof. Irving Fisher. 
 
INTEREST 
 
 25 
 
 and simple interest is spoken of as if it were a distinct 
 species in which the original principal remains unchanged, 
 even though interest is in default. There is really no such 
 thing as simple interest, since the interest money which is 
 wrongfully withheld by the borrower, may be by him em- 
 ployed, and thus compound interest be earned. But the 
 wrong party gets the benefit of the compounding. All the 
 calculations of finance depend upon compounding interest, 
 which is the only rational and consistent method. When 
 there is occasion hereafter to speak of the interest for one 
 period, it will be called "single interest." 
 
 § 14. Punctual Interest 
 
 The usual interest contract provides that the increase 
 shall be paid off in cash at the end of each period, restoring 
 the principal to its original amount. Let c denote the cash 
 payment ; then l + i — c = l; and the second term would 
 repeat the same process. The payment of cash for interest 
 must not be regarded as the interest ; it is a cancellation of 
 part of the increased principal. Many persons, and even 
 courts, have been misled by the old definition of interest — 
 "money paid for the use of money" — into treating uncol- 
 lected or unmatured interest as a nullity, though secured in 
 precisely the same way as the principal. 
 
 § 15. Computation of Interest 
 
 But the interest money may not be paid exactly at the 
 end of each term, either in violation of the contract or by 
 a special clause permitting it to run on, or by the debt being 
 assigned to a third party at a price which modifies the true 
 interest rate. In this case the question arises : How shall 
 the interest be computed for the following periods? This 
 gives rise to a distinction between simple and compound 
 interest. 
 
26 THE MATHEMATICS OF INVESTMENT 
 
 § 1 6. Simple Interest 
 
 During the second period, although the borrower has in 
 his hands an increased principal, 1 + i, he is at simple 
 interest charged with interest only on 1, and has the free 
 use of i, which, though small, has an earning power pro- 
 portionate to that of 1. His indebtedness at the end of the 
 second term is 1 + 2i, and thereafter 1 + 3f, 1 + 4z', etc. 
 After the first period he is not charged with the agreed per- 
 centage of the sum actually employed by him, and this to 
 the detriment of the creditor. For any scientific calculation, 
 simple interest is impossible of application. 
 
 §17. Compound Interest 
 
 The indebtedness at the end of the first period is 1 + 1, 
 and up to this point punctual, simple, and compound interest 
 coincide. But in compound interest the fact is recognized 
 that the increased principal, 1 + i, is all subject to interest 
 during the next period, and that the debt increases by geo- 
 metrical progression, not arithmetical. The increase from 
 1 to 1 + i is regarded, not as an addition of i to 1, but as a 
 multiplication of 1 by the ratio of increase (1 + i). We 
 shall designate the ratio of increase by r when convenient, 
 although this is merely an abbreviation of 1 + i, and the 
 two expressions are at all times interchangeable. 
 
 § 18. Computation of Compound Interest 
 
 At the end of the first period (which is equivalent to the 
 beginning of the second period), the actual indebtedness is 
 1 + i. This amount is the equitable principal for the second 
 period, and it should be again increased in the ratio 1 + i. 
 The total indebtedness at the end of the second period 
 (which is equivalent to the beginning of the third period) 
 is therefore 1 X (1 + 1) X (1 + ?-)• For the sake of brevity, 
 this may be written 1 X (1 + O^j the figure 2 (called an ex- 
 
INTEREST 
 
 27 
 
 ponent) indicating that the expression (I'+t) is to ,be 
 taken twice as a factor. Since the expression (1 + i) equals 
 the rate, a still simpler way of indicating the indebtedness at 
 the end of the first period is r; at the end of the second 
 period, r^. At the end of the third period the indebtedness 
 will have become t^ ; and at the end of period t, it will have 
 become r\ 
 
 § 19. Comparison of Simple and Compound Interest 
 
 The following schedule shows the accumulations of in- 
 terest for several periods, giving a comparison between the 
 simple interest computations and the compound interest 
 computations : 
 
 ■ 
 
 Indebtedness 
 
 Indebtedness 
 
 Time 
 
 Based on 
 
 Based on 
 
 
 Simple Interest 
 
 Compound Interest* 
 
 Beginning of 1st period.. 
 
 1 
 
 1 
 
 Beginning of 2nd period. 
 
 1-bi 
 
 l + t 
 
 Beginning of 3rd period. 
 
 l + 2i 
 
 (i + »T 
 
 Beginning of 4th period. . 
 
 l + 3i 
 
 (i+»r 
 
 Beginning of 5th period. . 
 
 l + 4i 
 
 (1 + 0* 
 
 etc. 
 
 
 
 •For the benefit of students familiar with algebra, it may be pointed out that 
 (1 + O* = 1 + 2i + t*. This differs from the simple interest computation by the 
 small quantity t*. Similarly, (1 + t)^ = 1 + 3t + 3i^ + »^, which differs from the 
 simple interest result, 1 + Si, by the quantity Si'^ + *"'• Tests may be readily made 
 of the computations by substituting a numerical rate, say .06, in place of i. If this 
 be done, the simple interest result at the beginning of the 4th period is found to be 
 14- (3 times .06), or 1.18. The compound interest result would be: 
 
 1 =1. 
 
 plus 3 times .06 = .18 
 plus 3 timco .06', or 
 
 3 times .0036 = .0108 
 plus .06» = .000216 
 
 That is, (1.06)« = 1.191016 
 
28 THE MATHEMATICS OF INVESTMENT 
 
 § 20. The Day as a Time Unit 
 
 Coming now to a discussion of frequency and time, in 
 connection with the subject of interest, we find that the 
 smallest unit of time is one day, since the law does not 
 recognize interest for fractions of a day. The legal day 
 begins at midnight and ends on the following midnight. In 
 reckoning from one day to another, the day from which 
 should be excluded. Thus, if a loan is made at any hour 
 on the third day of the month and is paid at any hour on 
 the fourth, there is one day's interest due, the interest being 
 for the fourth day and not for the third. Practically it is 
 the nights that count. If five midnights have passed since 
 the loan was made, then the accrued interest is for a period 
 of five days. 
 
 § 21. The Month as a Time Unit 
 
 As has been previously stated, weeks are not used as 
 time units. The next longer interest period after a day is 
 a month. Calendar months are computed as follows : Com- 
 mence at the day from which the reckoning is made, and 
 exclude that day; then the day in the next month having 
 the same number will at its close complete the first month ; 
 the second month will end with the same numbered day, 
 and so on to the same day of the final month. A difficulty 
 arises in the case where the initial date is the 31st, while the 
 last month has only thirty days or less. In this case the 
 interest month ends with the last day of the calendar month. 
 For example, one month from January 31st, 1912, was 
 February 29th; one month from January 30th or 29th, in 
 the same year, also terminated on February 29th ; in a com- 
 mon year, not a leap year, the last day of a period one 
 month from January 28th, 29th, 30th or 31st, would be 
 February 28th. 
 
INTEREST 
 
 29 
 
 § 22. Half and Quarter Years 
 
 Since there are no fractions of a day in interest compu- 
 tations, it becomes necessary to inquire what is meant by 
 a half-year or by a quarter. In the State of New York the 
 Statutory Construction Law (Laws of 1892, Chapter 677, 
 § 25) solves this difficulty by prescribing that a half-year 
 is not 182% days, but six calendar months; and that a 
 quarter is not 91^/4 days, but three calendar months. 
 
 § 23. Partial Interest Periods 
 
 In practice any fraction of an interest period is com- 
 puted at the corresponding fraction of the rate, although 
 theoretically this is not quite just. For example, if the 
 interest rate is 6% per annum, payable annually, making 
 the ratio of increase 1.06, then it is customary to consider 
 the ratio of increase for a half-year as 1.03; whereas 
 theoretically it should be the square root of 1.06, or slightly 
 over 1.029563. 
 
 If the regular period is one year, any odd days should 
 be reckoned as 365ths of a year. Also, if the contract is for 
 days only and there is no mention of months, quarters, or 
 half-years, then also a day should be regarded as 1/365 of 
 a year. But when the contract is for months, quarters, or 
 half-years, any fractional time should be divided into months, 
 and there is usually an odd number of days left over. In 
 New York, doubt exists as to how these odd days should 
 be treated, whether on a 365-day basis or on a 360-day basis. 
 
 Before 1892 there was no doubt. The statute distinctly 
 stated that a number of days less than a month should be 
 estimated for the purpose of interest computations as 30ths 
 of a month, or, consequently, 360ths of a year. This was 
 a most excellent provision, and merely enacted what had 
 been the custom long before. The so-called "360-day" in- 
 terest tables are based upon this rule. In 1892, however, 
 
30 
 
 THE MATHEMATICS OF INVESTMENT 
 
 the revisers of the statutes of the State of New York 
 dropped this sensible provision and left the question open. 
 No judicial decision has since been rendered on the subject, 
 but many good lawyers think that the odd days should be 
 computed as 365ths of a year. In business nearly every 
 one calls the odd days 360ths, and it is only in legal account- 
 ings that there can be any question. It would be well if 
 the old provision could be re-enacted by law or re-established 
 by the courts. 
 
 § 24. Changing the Day Basis 
 
 If the interest for a certain number of odd days has been 
 computed on a 360-day basis, a change may be readily made 
 to a 365-day basis by subtracting from such interest 1/73 
 of itself. On the other hand, if the interest for an odd 
 number of days has been ascertained on a 365-day basis, 
 the addition of 1/72 of itself to this amount will give the 
 interest on a 360-day basis. 
 
 § 25. The Amount — First Period 
 
 The principal and interest taken together constitute the 
 amount. At the end of the first half-year period, the 
 amount of $1.00 at 6% interest, payable semi-annually, is 
 $1.03. Instead of considering the $1.00 and the 3 cents as 
 two separate items to be added together, it is best to con- 
 sider the operation as the single one of multiplying $1.00 
 by the ratio of increase, 1.03. Sometimes the error is made 
 of considering that the original principal of $1.00 is multi- 
 plied by $1.03, or, in other words, that a certain number 
 of dollars is multiplied by another number of dollars. It 
 is well to emphasize, in this connection, the old principle 
 given in arithmetic, that one concrete number cannot be 
 multiplied by another concrete number. We cannot multi- 
 ply dollars by dollars, or feet by feet, or horses by dollars. 
 The multiplicand may be either a concrete or an abstract 
 number, but the multiplier must always be abstract. 
 
INTEREST 
 
 31 
 
 § 26. The Amount — Subsequent Periods 
 
 The principal which is employed during the second 
 period is $1.03. It is evident that this, like the original 
 $1.00, should be multiplied by the ratio 1.03. The new 
 amount will be the square of 1.03, which we may write: 
 
 1.03 X 1.03 
 or, 1.03=^ 
 or, 1.0609 
 
 This is the new amount on interest during the third period. 
 At the end of the third period the amount will be : 
 
 1.03 X 1.03 X 1.03 
 or, 1.03' 
 or, 1.092727 
 
 At the end of the fourth period the amount becomes : 
 
 1.03* 
 
 or, 1.12550881 
 
 Possibly at this point the number of decimal places may be 
 unwieldy. If we desire to have only seven decimal places, 
 we reject the final 1, rounding the result oif to 1.1255088; 
 if we prefer to use only six places, we round the result up 
 to 1.125509, which is more nearly correct than 1.125508. 
 
 § 27. Exponents and Powers 
 
 In some of the following paragraphs, it will be neces- 
 sary to speak occasionally of exponents and powers. In 
 the expression 1.03^, the figure 2 is called an exponent, and 
 it means (as indicated in the preceding paragraph) that 
 1.03 is to be taken twice as a factor. In other words, the 
 number is to be multiplied by itself. The result, 1.0609 
 (which equals 1.03^), is said to be the second power of 1.03 ; 
 1.092727 is the third power of 1.03, and so on. (See also 
 §38.) 
 
32 THE MATHEMATICS OF INVESTMENT 
 
 § 28. Finding the Amount — Compound Interest 
 
 The amount of $1.00 at the end of any number of 
 periods is obtained by taking such a power of the ratio of 
 increase as is indicated by the number of periods; or, in 
 other words, by muhiplying $1.00 by the ratio as many 
 times as there are periods. If the original principal be sub- 
 tracted from the amount, the remainder is the compound 
 interest. For example, in § 26, the amount of $1.00 at the 
 ratio 1.03, for four periods, is $1.12550881; and the com- 
 pound interest is $.12550881. 
 
 § 29. Present Worth 
 
 The present worth of a future sum is a smaller sum 
 which, put at interest, will amount to the future sum. The 
 present worth of $1.00 is such a sum as, at the given rate 
 and for the given period, will amount to $1.00. In order 
 to illustrate the method of ascertaining the present worth, 
 let us suppose that it is desired to find the present worth 
 of $1.00, due in four years, the ratio of increase being 1.03 
 per annum. The required figure must evidently be such 
 that, when multiplied four times in succession by 1.03, the 
 result will be $1.00. Therefore, by using the reverse 
 process, division, the required figure may be obtained. The 
 first operation, by ordinary long division, results as follows : 
 
 1.03 ) 1.00000000 ( .970873 
 927 
 730 
 721 
 900 
 824 
 760 
 721 
 390 
 309 
 81 
 
INTEREST 33 
 
 The result, rounded up at the 6th place, is .970874, this 
 being the present worth of $1.00 due in one period at 3% 
 interest. The present worth for two periods may be ob- 
 tained either by again dividing .970874 by 1.03, or by mul- 
 tiplying .970874 by itself, or by dividing 1 by 1.0609 (the 
 square of 1.03), each of which operations gives the same 
 result, .942596. The present worth for three periods may 
 also be obtained in several ways, the result being the same 
 in all cases, .915142, or ^^. The present worth for four 
 periods is ^, or .888487. 
 
 § 30. Present Worth and Amount Series 
 
 If we arrange these results in reverse order, followed 
 by $1.00 and by the amounts computed in § 26, we have a 
 continuous series : 
 
 1- 
 
 - 1.03* 
 
 -= .888487 
 
 1- 
 
 - 1.03' 
 
 -= .915142 
 
 1- 
 
 -1.03' 
 
 -= .942596 
 
 1- 
 
 -1.03 
 
 =- .970874 
 
 1. 
 = 1.03 
 
 1 X 1.03 
 
 1 X 1.03' 
 
 = 1.0609 
 
 1 X 1.03' 
 
 = 1.092727 
 
 1> 
 
 < 1.03* 
 
 = 1.125509 
 
 § 31. Relation between Present Worth and Amount 
 
 In the foregoing series, which might be extended in- 
 definitely upward and downward, every term is a present 
 worth of the one which immediately follows it, and an 
 amount of the one which immediately precedes it. When 
 one number is the amount of another, the latter number is 
 the present worth of the former. For example, .888487 is 
 the present worth of 1.125509 for 8 interest periods; and, 
 on the other hand, 1.125509 is the amount of .888487, for 
 the same number of interest periods and at the same ratio. 
 
34 
 
 THE MATHEMATICS OF INVESTMENT 
 
 In some instances in this series, a present worth and its 
 corresponding amount are reciprocals (that is, their product 
 is 1), but this is true only when the two figures are distant 
 an equal number of periods from 1, the present-worth 
 figure being upward from 1 and the amount figure being 
 downward from 1. Thus, .915142, or 1 -^- 1.03^, is the 
 reciprocal of 1.092727, or 1.03^ 
 
 § 32. Formation of Series 
 
 K any term of the series be multiplied by 1.03, the 
 product will be the next following term ; if it be divided by 
 1.03 or (which amounts to the same thing) be multiplied by 
 .970874, the result will be the next preceding term. Since 
 multiplying by 1.03 is easier than dividing by it, and also 
 easier than multiplying by .970874, the easiest way of 
 obtaining the different numbers in the series is to compute 
 first the smallest number (in this case, .888487), and then 
 perform successive multiplications by 1.03. A brief process 
 for finding this initial number will be explained in the next 
 chapter. 
 
 § 33. Discount 
 
 In considering the present worth of $1.00 for a single 
 period (.970874), it is evident that the original $1.00 has 
 been diminished by .029126, which is a little less than .03; 
 in fact it is .03 -^ 1.03. This difference, .029126, is called 
 the discount. In the present worth for two periods, the dis- 
 count is 1 — .942596, or .057404. This discount for two 
 periods, and likewise the discounts for three or more 
 periods, are called compound discounts. 
 
 § 34. Computing Compound Discount 
 
 The compound discount for any number of periods may 
 be found either by subtracting the present worth from 1, or 
 
INTEREST 
 
 35 
 
 by finding the present worth of the compound interest for 
 the same time and at the same rate. As an illustration, 
 suppose that it is desired to find the compound discount of 
 $1.00 for three periods at 3%. First, we may subtract the 
 present worth, .915142, from. 1, which gives the compound 
 discount as .084858. Second, we may divide the compound 
 interest (.092727) by the amount of $1.00 for the three 
 periods (1.092727), which gives the compound discount the 
 same as before, .084858. 
 
 § 35. Formulas for Interest Calculations 
 
 We may reduce the rules to more compact form by the 
 use of symbols. Let a represent the amount of $1.00 for 
 any number of periods (it periods) ; p the present worth; 
 i the rate of interest per period ; d the rate of discount per 
 period, and n the number of periods. Let the compound 
 interest be represented by I, and the compound discount by 
 D. Then, by §17, the ratio of increase is (1 + i). By 
 §28, a=(l-}-iy; and I==a — 1. By §29, /> = 1-^ 
 (1 + 0"; and by § 34, D = 1 - /), or I -^ a. 
 
 § 36. Use of Logarithms 
 
 The method of ascertaining the values of a and p 
 through successive multiplications and divisions for a large 
 number of periods, is intolerably slow. A much briefer way 
 is by the use of certain auxiliary numbers called logarithms 
 as explained in the next chapter. 
 
CHAPTER III 
 
 THE USE OF LOGARITHMS 
 
 § 37. Purpose of Logarithms 
 
 For multiplying or dividing a great many times by the 
 same number, or for finding powers and roots, there is no 
 device superior to a table of logarithms. Although the 
 computation of logarithms — as in the formation of a table of 
 logarithms — requires a knowledge of algebra, the practical 
 use of logarithmic tables does not require such knowledge. 
 The aid derived from such tables is purely arithmetical, and 
 the occasional prejudice against logarithms as something 
 mysterious or occult is without reasonable foundation. 
 
 § 38. Exponents, Powers, and Roots 
 
 We have seen in § 27 that an exponent is a number writ- 
 ten at the right and slightly above another number to indi- 
 cate how many times the latter is to be taken as a factor; 
 and also that a power is the result obtained by taking any 
 given number a certain number of times as a factor. We 
 now add that a root is the number repeated as a factor to 
 form a power. The following table exemplifies roots, 
 exponents, and powers : 
 
 Roots and ^^ 
 
 T, , Powers 
 
 Exponents 
 
 22 = 2X2 =4 
 
 32 = 3x3 =9 
 
 4' = 4 X 4 =16 
 
 etc. 
 2^ = 2X2X2= 8 
 3' = 3X3X3 = 27 
 43 = 4X4X4 = 64 
 
 etc. 
 
 36 
 
THE USE OF LOGARITHMS 
 
 37 
 
 The root of a number is called its first power. When the 
 root is taken twice as a factor, the result is called the second 
 power, or square ; when taken three times, the result is the 
 third power, or cube; we may in like manner obtain the 
 fourth, fifth, or any power of a root by repeating it as a 
 factor the required number of times. 
 
 § 39. Logarithms as Exponents 
 
 Now, logarithms are merely exponents of certain roots 
 which are called bases. The common system of logarithms 
 is based upon the number 10, this number being the basis of 
 our decimal system of numeration. 
 
 Taking a specific illustration, let us multiply six lO's 
 together, 10 X 10 X 10 X 10 X 10 X 10 ; we may write the 
 result as : 
 
 1,000,000 
 or, 10" 
 or, the sixth power of ten. 
 
 The small figure "6'* is the exponent of the power. A 
 series of some of the powers of 10 might be represented as 
 follows : 
 
 1,000,000 or 10" 
 
 100,000 
 
 
 10° 
 
 10,000 
 
 
 10* 
 
 1,000 
 
 
 10' 
 
 100 
 
 
 10^ 
 
 10 
 
 
 10' 
 
 1 
 
 tt 
 
 10" 
 
 From the above series, the following observations may 
 be made : 
 
 (1) The number of zeroes in any number in the first 
 column is the same as the exponent in the second column. 
 
 (2) Each term in the first column is one-tenth of the 
 
2fi THE MATHEMATICS OF INVESTMENT 
 
 one above it, while in the second column each exponent is one 
 less than the exponent above it. This leads to the result 
 that 10*^ = 1, which at first seems impossible. It is difficult 
 to understand how 10, taken zero times as a factor, equals 
 1, but such nevertheless is a fact, as can be easily demon- 
 strated by algebra.* 
 
 (3) By adding any two exponents in the second column, 
 w^e may find the result of multiplying together the two 
 corresponding numbers in the first column. For example, 
 10' (or 100) times 10' (or 1,000) equals 10' + ^ i.e., 10' 
 (or 100,000) ; in other words, by adding the logarithms of 
 two numbers we obtain the logarithm of their product. 
 Again, by finding the difference between any two logarithms 
 in the second column, we may find the quotients of the 
 corresponding numbers in the first column. For example, 
 10' - ' = 10' = 1,000, which = 100,000 -f- 100; i.e., by sub- 
 tracting logarithms the logarithms of quotients are found. 
 
 Suppose we should wish to obtain the second power of 
 10'; the exponent (or index) of the second power is 2; and 
 10^ X 2 == ;^Q6 ^ -^QQQ ^ -^QQQ^ ^j. ^^000,000 ; from which it 
 
 appears that by multiplying the logarithm 3 by the index 2 
 we have obtained the square of 10', or 1,000. Again 10^ "^ ^ 
 = 10' = 1,000, or the square root of 1,000,000; from 
 which it appears that, by dividing the logarithm 6 by the 
 index 2, we obtain the square root of 10^. 
 
 § 40. Rules and Symbols of Logarithms 
 
 Summarized very briefly, the rules of logarithms, de- 
 duced from the foregoing illustrations, are as follows: 
 
 By the use of the equation : 
 
 Therefore, x<> = 1 
 
 or, if X =10 
 
 10»= 1 
 
 — = !• — =x*-» — x» 
 
THE USE OF LOGARITHMS 39 
 
 (1) By adding logarithms, numbers are multiplied. 
 
 (2) By subtracting logarithms, numbers are divided. 
 
 (3) By midtiplying logarithms, numbers are raised to 
 powers. 
 
 (4) By dividing logarithms, the roots of numbers are 
 extracted. 
 
 The last two of these rules are the only ones necessary 
 to be employed in the calculations of compound interest. 
 
 With this preliminary explanation of logarithms, the 
 series in § 39 may be rewritten and "extended"; the symbol 
 nl meaning *'the number whose logarithm is." 
 
 The base being 10, 
 1,000,000 is the number whose logarithm is 6, 
 or, in contracted form. 
 
 10« = 
 
 1,000,000. 
 
 nl 
 
 6 
 
 10' = 
 
 100,000. 
 
 nl 
 
 5 
 
 10* = 
 
 10,000. 
 
 nl 
 
 4 
 
 10' = 
 
 1,000. 
 
 nl 
 
 3 
 
 10" = 
 
 100. 
 
 nl 
 
 2 
 
 10^ = 
 
 10. 
 
 nl 
 
 1 
 
 10« = 
 
 1. 
 
 nl 
 
 
 
 
 .1 
 
 nl ■ 
 
 -1 
 
 
 .01 
 
 nl 
 
 -2 
 
 
 .001 
 
 nl 
 
 -3 
 
 
 .0001 
 
 nl 
 
 -4 
 
 
 .00001 
 
 nl ■ 
 
 -5 
 
 Occasionally the symbol In will also be used, its meaning 
 being *'the logarithm of the number." 
 
 From the above, it will be seen that the logarithm of a 
 number is merely the exponent which indicates the power 
 to which some given number, called the base, would have 
 to be raised in order to give that number. If the number 
 
40 
 
 THE MATHEMATICS OF INVESTMENT 
 
 were 100 and the base 10, then 10 would have to be raised 
 to the second power to give 100; in other words, the loga- 
 rithrn of 100, with 10 as a base, is 2. If the number were 
 100,000, the base still being 10, then 10 would have to be 
 raised to the fifth power to give the number; or we may 
 say, in different language, that the logarithm of 100,000, 
 with 10 as a base, is 5. 
 
 § 41. The Two Parts of a Logarithm 
 
 The logarithms of a few numbers have already been 
 given, but for practical use in calculating we need the loga- 
 rithms of a great many others. From the series in § 39, it 
 may be readily inferred that the numbers between 1 and 10 
 must have their logarithms between and 1 ; that is, the 
 logarithms of these numbers must be fractions. In tables 
 of logarithms, these fractions are expressed as decimals, 
 the usual number of decimal places being seven. Similarly, 
 the numbers between 10 and 100 have their logarithms be- 
 tween 1 and 2 ; that is, these logarithms are 1 plus a decimal 
 fraction. 
 
 To give a few illustrations: 
 
 The logarithm of 10 = 1. 
 
 12 = 1.0792 
 20 = 1.3010 
 50 = 1.6990 
 90 = 1.9542 
 99 = 1.9956 
 100 = 2. 
 
 It will be observed that there are usually two parts to a 
 logarithm — ^the decimal part and the whole number preced- 
 ing the decimal. The decimal part is known as the mantissa, 
 and the whole number as the characteristic. From the man- 
 tissa of a logarithm, we are able (through the aid of loga- 
 
THE USE OF LOGARITHMS 
 
 41 
 
 rithmic tables) to determine the corresponding number, 
 except as to the position of its decimal point. This latter 
 is determined by the characteristic, which, for numbers 
 greater than 1, is always one less than the number of places 
 to the left of the decimal point. For numbers less than 1, 
 the characteristic is said to be negative, and it is equal to 
 the number of places to the right from the decimal point to 
 the place occupied by the first significant figure of the 
 decimal. A negative characteristic is indicated by a short 
 dash placed above it. A characteristic may thus be either 
 positive or negative, but a mantissa is always positive. 
 
 §42. Mantissa Not Affected by Position of the Decimal 
 Point 
 
 In the logarithms of 20, 200, 2,000, 20,000, 200,000, 
 2,000,000, etc., we shall find the same decimal part, .301 030 
 (which is the logarithm of 2), preceded by the figures 1, 2, 
 3, 4, 5, 6, etc. This same thing is true of any combination 
 of figures; that is to say, whatever may be the position of 
 the decimal point in a number, the logarithm of that num- 
 ber always has the same decimal fraction, or mantissa. 
 
 Thus, if the logarithm of 2.378 is .376 212, then, 
 
 .0002378 nl 4.376 212 
 .002378 nl 3.376 212 
 
 .02378 
 
 nl 2.376 212 
 
 .2378 
 
 nl 1.376 212 
 
 2.378 
 
 nl .376 212 
 
 .23.78 
 
 nl 1.376 212 
 
 237.8 
 
 nl 2.376 212 
 
 2,378. 
 
 nl 3.376 212 
 
 23,780. 
 
 nl 4.376 212 
 
 237,800. 
 
 nl 5.376 212 
 
 etc. 
 
 etc. 
 
42 
 
 THE MATHEMATICS OF INVESTMENT 
 
 § 43. Four-Place Table of Logarithms 
 
 Illustrations will now be given of the properties of loga- 
 rithms, and for this purpose a table of the logarithms of 
 numbers from 10 to 99, inclusive, to four places of decimals, 
 is given on the following pages. This is a very simple table 
 of logarithms, and is known as a four-place table. 
 
 -The ordinary tables of logarithms are calculated to seven 
 places of decimals. If it is desired to multiply the number 
 82 by 1.03 fifty times in succession, ordinary logarithm 
 tables would give only the first seven figures of the answer. 
 If this operation were performed accurately by the simple 
 processes of multiplication, the answer vrould contain 103 
 figures, 3 in front of the decimal point and 100 after it. 
 Since the figures after the first seven are for most purposes 
 insignificant, the result obtained by logarithms will be near 
 enough even if rounded off at the sixth figure. 
 
 N 
 
 
 
 1 
 
 2 
 
 3 
 
 4 
 
 5 
 
 6 
 
 7 
 
 8 
 
 9 
 
 10 
 
 0000 
 
 043 
 
 086 
 
 128 
 
 170 
 
 212 
 
 253 
 
 294 
 
 334 
 
 374 
 
 11 
 
 0414 
 
 453 
 
 492 
 
 531 
 
 569 
 
 607 
 
 645 
 
 682 
 
 719 
 
 755 
 
 12 
 
 0792 
 
 828 
 
 864 
 
 899 
 
 934 
 
 969 
 
 *004 
 
 *038 
 
 *072 
 
 ♦106 
 
 13 
 
 1139 
 
 173 
 
 206 
 
 239 
 
 271 
 
 303 
 
 335 
 
 367 
 
 399 
 
 430 
 
 14 
 
 1461 
 
 492 
 
 523 
 
 553 
 
 584 
 
 614 
 
 644 
 
 67Z 
 
 703 
 
 732 
 
 15 
 
 1761 
 
 790 
 
 818 
 
 847 
 
 875 
 
 903 
 
 931 
 
 959 
 
 987 
 
 *014 
 
 16 
 
 2041 
 
 068 
 
 095 
 
 122 
 
 148 
 
 175 
 
 201 
 
 227 
 
 253 
 
 279 
 
 17 
 
 2304 
 
 330 
 
 355 
 
 380 
 
 405 
 
 430 
 
 455 
 
 480 
 
 504 
 
 529 
 
 18 
 
 2553 
 
 577 
 
 601 
 
 625 
 
 648 
 
 672 
 
 695 
 
 718 
 
 742 
 
 765 
 
 19 
 
 2788 
 
 810 
 
 833 
 
 856 
 
 878 
 
 900 
 
 923 
 
 945 
 
 967 
 
 989 
 
 20 
 
 3010 
 
 032 
 
 054 
 
 075 
 
 096 
 
 118 
 
 139 
 
 160 
 
 181 
 
 201 
 
 21 
 
 3222 
 
 243 
 
 263 
 
 284 
 
 304 
 
 324 
 
 345 
 
 365 
 
 385 
 
 404 
 
 22 
 
 3424 
 
 444 
 
 464 
 
 483 
 
 502 
 
 522 
 
 541 
 
 560 
 
 579 
 
 598 
 
 23 
 
 3617 
 
 636 
 
 655 
 
 674 
 
 692 
 
 711 
 
 729 
 
 747 
 
 766 
 
 784 
 
 24 
 
 3802 
 
 820 
 
 838 
 
 856 
 
 874 
 
 892 
 
 909 
 
 927 
 
 945 
 
 962 
 
 25 
 
 3979 
 
 997 
 
 *014 
 
 *031 
 
 *048 
 
 *065 
 
 *082 
 
 *099 
 
 *116 
 
 *133 
 
 26 
 
 4150 
 
 166 
 
 183 
 
 200 
 
 216 
 
 232 
 
 249 
 
 265 
 
 281 
 
 298 
 
 27 
 
 4314 
 
 330 
 
 346 
 
 362 
 
 378 
 
 393 
 
 409 
 
 425 
 
 440 
 
 456 
 
 28 
 
 4472 
 
 487 
 
 502 
 
 518 
 
 533 
 
 548 
 
 564 
 
 579 
 
 594 
 
 609 
 
 29 
 
 4624 
 
 639 
 
 654 
 
 669 
 
 683 
 
 698 
 
 713 
 
 728 
 
 742 
 
 757 
 
 See explanation at the end of this section. 
 
THE USE OF LOGARITHMS 
 
 43 
 
 N 
 
 
 
 1 
 
 2 
 
 3 
 
 4 
 
 5 
 
 6 
 
 7 
 
 8 
 
 9 
 
 30 
 
 4771 
 
 786 
 
 800 
 
 814 
 
 829 
 
 843 
 
 857 
 
 871 
 
 886 
 
 900 
 
 31 
 
 4914 
 
 928 
 
 942 
 
 955 
 
 969 
 
 983 
 
 997 
 
 *011 
 
 *024 
 
 *038 
 
 32 
 
 5051 
 
 065 
 
 079 
 
 092 
 
 105 
 
 119 
 
 132 
 
 145 
 
 159 
 
 172 
 
 33 
 
 5185 
 
 198 
 
 211 
 
 224 
 
 237 
 
 250 
 
 263 
 
 276 
 
 289 
 
 302 
 
 34 
 
 5315 
 
 328 
 
 340 
 
 353 
 
 366 
 
 378 
 
 391 
 
 403 
 
 416 
 
 428 
 
 35 
 
 5441 
 
 453 
 
 465 
 
 478 
 
 490 
 
 502 
 
 514 
 
 527 
 
 539 
 
 551 
 
 36 
 
 5563 
 
 575 
 
 587 
 
 599 
 
 611 
 
 623 
 
 635 
 
 647 
 
 658 
 
 670 
 
 37 
 
 5682 
 
 694 
 
 705 
 
 717 
 
 729 
 
 740 
 
 752 
 
 763 
 
 775 
 
 786 
 
 38 
 
 5798 
 
 809 
 
 821 
 
 832 
 
 843 
 
 855 
 
 866 
 
 877 
 
 888 
 
 899 
 
 39 
 
 5911 
 
 922 
 
 933 
 
 944 
 
 955 
 
 966 
 
 977 
 
 988 
 
 999 
 
 *010 
 
 40 
 
 6021 
 
 031 
 
 042 
 
 053 
 
 064 
 
 075 
 
 085 
 
 096 
 
 107 
 
 117 
 
 41 
 
 6128 
 
 138 
 
 149 
 
 160 
 
 170 
 
 180 
 
 191 
 
 201 
 
 212 
 
 222 
 
 42 
 
 6232 
 
 243 
 
 253 
 
 263 
 
 274 
 
 284 
 
 294 
 
 304 
 
 314 
 
 325 
 
 43 
 
 6335 
 
 345 
 
 355 
 
 365 
 
 375 
 
 385 
 
 395 
 
 405 
 
 415 
 
 425 
 
 44 
 
 6435 
 
 444 
 
 454 
 
 464 
 
 474 
 
 484 
 
 493 
 
 503 
 
 513 
 
 522 
 
 45 
 
 6532 
 
 542 
 
 551 
 
 561 
 
 571 
 
 580 
 
 590 
 
 599 
 
 609 
 
 618 
 
 46 
 
 6628 
 
 637 
 
 646 
 
 656 
 
 665 
 
 675 
 
 684 
 
 693 
 
 702 
 
 712 
 
 47 
 
 6721 
 
 730 
 
 739 
 
 749 
 
 758 
 
 767 
 
 776 
 
 785 
 
 794 
 
 803 
 
 48 
 
 6812 
 
 821 
 
 830 
 
 839 
 
 848 
 
 857 
 
 866 
 
 875 
 
 884 
 
 893 
 
 49 
 
 6902 
 
 911 
 
 920 
 
 928 
 
 937 
 
 946 
 
 955 
 
 964 
 
 972 
 
 981 
 
 50 
 
 6990 
 
 998 
 
 ^007 
 
 *016 
 
 *024 
 
 *033 
 
 *042 
 
 *050 
 
 *059 
 
 *067 
 
 51 
 
 7076 
 
 084 
 
 093 
 
 101 
 
 110 
 
 118 
 
 126 
 
 135 
 
 143 
 
 152 
 
 52 
 
 7160 
 
 168 
 
 177 
 
 185 
 
 193 
 
 202 
 
 210 
 
 218 
 
 226 
 
 235 
 
 53 
 
 7243 
 
 251 
 
 259 
 
 267 
 
 275 
 
 282 
 
 292 
 
 300 
 
 308 
 
 316 
 
 54 
 
 7324 
 
 332 
 
 340 
 
 348 
 
 356 
 
 364 
 
 372 
 
 380 
 
 388 
 
 396 
 
 55 
 
 7404 
 
 412 
 
 419 
 
 427 
 
 435 
 
 443 
 
 451 
 
 459 
 
 466 
 
 474 
 
 56 
 
 7482 
 
 490 
 
 497 
 
 505 
 
 513 
 
 520 
 
 528 
 
 536 
 
 543 
 
 551 
 
 57 
 
 7559 
 
 566 
 
 574 
 
 582 
 
 589 
 
 597 
 
 604 
 
 612 
 
 619 
 
 627 
 
 58 
 
 7634 
 
 642 
 
 649 
 
 657 
 
 664 
 
 672 
 
 679 
 
 686 
 
 694 
 
 701 
 
 59 
 
 7709 
 
 716 
 
 723 
 
 731 
 
 738 
 
 745 
 
 752 
 
 760 
 
 767 
 
 774 
 
 60 
 
 7782 
 
 789 
 
 796 
 
 803 
 
 810 
 
 818 
 
 825 
 
 832 
 
 839 
 
 846 
 
 61 
 
 7853 
 
 860 
 
 868 
 
 875 
 
 882 
 
 889 
 
 896 
 
 903 
 
 910 
 
 917 
 
 62 
 
 7924 
 
 931 
 
 938 
 
 945 
 
 952 
 
 959 
 
 966 
 
 973 
 
 980 
 
 987 
 
 63 
 
 7993 
 
 *000 
 
 *007 
 
 *014 
 
 *021 
 
 *028 
 
 *035 
 
 *041 
 
 *048 
 
 *055 
 
 64 
 
 8062 
 
 069 
 
 075 
 
 082 
 
 089 
 
 096 
 
 102 
 
 109 
 
 116 
 
 122 
 
 * See explanation at the end of this section. 
 
44 
 
 THE MATHEMATICS OF INVESTMENT 
 
 N 
 
 
 
 1 
 
 2 
 
 3 
 
 4 
 
 5 
 
 6 
 
 7 
 
 8 
 
 9 
 
 65 
 
 8129 
 
 136 
 
 142 
 
 149 
 
 156 
 
 162 
 
 169 
 
 176 
 
 182 
 
 189 
 
 66 
 
 8195 
 
 202 
 
 209 
 
 215 
 
 222 
 
 228 
 
 235 
 
 241 
 
 248 
 
 254 
 
 67 
 
 8261 
 
 267 
 
 274 
 
 280 
 
 287 
 
 293 
 
 299 
 
 306 
 
 312 
 
 319 
 
 68 
 
 8325 
 
 331 
 
 338 
 
 344 
 
 351 
 
 357 
 
 363 
 
 370 
 
 376 
 
 382 
 
 69 
 
 8388 
 
 395 
 
 401 
 
 407 
 
 414 
 
 420 
 
 426 
 
 432 
 
 439 
 
 445 
 
 70 
 
 8451 
 
 457 
 
 463 
 
 470 
 
 476 
 
 482 
 
 488 
 
 494 
 
 500 
 
 506 
 
 71 
 
 8513 
 
 519 
 
 525 
 
 531 
 
 537 
 
 543 
 
 549 
 
 555 
 
 561 
 
 567 
 
 72 
 
 8573 
 
 579 
 
 585 
 
 591 
 
 597 
 
 603 
 
 609 
 
 615 
 
 621 
 
 627 
 
 73 
 
 8633 
 
 639 
 
 645 
 
 651 
 
 657 
 
 663 
 
 669 
 
 675 
 
 681 
 
 686 
 
 74 
 
 8692 
 
 698 
 
 704 
 
 710 
 
 716 
 
 722 
 
 727 
 
 7ZZ 
 
 739 
 
 745 
 
 75 
 
 8751 
 
 756 
 
 762 
 
 768 
 
 774 
 
 779 
 
 785 
 
 791 
 
 797 
 
 802 
 
 76 
 
 8808 
 
 814 
 
 820 
 
 825 
 
 831 
 
 837 
 
 842 
 
 848 
 
 854 
 
 859 
 
 77 
 
 8865 
 
 871 
 
 876 
 
 882 
 
 887 
 
 893 
 
 899 
 
 904 
 
 910 
 
 915 
 
 78 
 
 8921 
 
 927 
 
 932 
 
 938 
 
 943 
 
 949 
 
 954 
 
 960 
 
 965 
 
 971 
 
 79 
 
 8976 
 
 982 
 
 987 
 
 993 
 
 998 
 
 *004 
 
 *009 
 
 *015 
 
 *020 
 
 *025 
 
 80 
 
 9031 
 
 036 
 
 042 
 
 047 
 
 053 
 
 058 
 
 063 
 
 069 
 
 074 
 
 079 
 
 81 
 
 9085 
 
 090 
 
 096 
 
 101 
 
 106 
 
 112 
 
 117 
 
 122 
 
 128 
 
 133 
 
 82 
 
 9138 
 
 143 
 
 149 
 
 154 
 
 159 
 
 165 
 
 170 
 
 175 
 
 180 
 
 186 
 
 83 
 
 9191 
 
 196 
 
 201 
 
 206 
 
 212 
 
 217 
 
 222 
 
 227 
 
 232 
 
 238 
 
 84 
 
 9243 
 
 248 
 
 253 
 
 258 
 
 263 
 
 269 
 
 274 
 
 279 
 
 284 
 
 289 
 
 85 
 
 9294 
 
 299 
 
 304 
 
 309 
 
 315 
 
 320 
 
 325 
 
 330 
 
 335 
 
 340 
 
 86 
 
 9345 
 
 350 
 
 355 
 
 360 
 
 365 
 
 370 
 
 375 
 
 380 
 
 385 
 
 390 
 
 87 
 
 9395 
 
 400 
 
 405 
 
 410 
 
 415 
 
 420 
 
 425 
 
 430 
 
 435 
 
 440 
 
 88 
 
 9445 
 
 450 
 
 455 
 
 460 
 
 465 
 
 469 
 
 474 
 
 479 
 
 484 
 
 489 
 
 89 
 
 9494 
 
 499 
 
 504 
 
 509 
 
 513 
 
 518 
 
 523 
 
 528 
 
 533 
 
 538 
 
 90 
 
 9542 
 
 547 
 
 552 
 
 557 
 
 562 
 
 566 
 
 571 
 
 576 
 
 581 
 
 586 
 
 91 
 
 9590 
 
 595 
 
 600 
 
 605 
 
 609 
 
 614 
 
 619 
 
 624 
 
 628 
 
 633 
 
 92 
 
 9638 
 
 643 
 
 647 
 
 652 
 
 657 
 
 661 
 
 666 
 
 671 
 
 675 
 
 680 
 
 93 
 
 9685 
 
 689 
 
 694 
 
 699 
 
 703 
 
 708 
 
 713 
 
 717 
 
 722 
 
 727 
 
 94 
 
 9731 
 
 736 
 
 741 
 
 745 
 
 750 
 
 754 
 
 . 759 
 
 763 
 
 768 
 
 77Z 
 
 95 
 
 9777 
 
 782 
 
 786 
 
 791 
 
 795 
 
 800 
 
 805 
 
 809 
 
 814 
 
 818 
 
 96 
 
 9823 
 
 827 
 
 832 
 
 836 
 
 841 
 
 845 
 
 850 
 
 854 
 
 859 
 
 863 
 
 97 
 
 9868 
 
 872 
 
 877 
 
 881 
 
 886 
 
 890 
 
 894 
 
 899 
 
 903 
 
 908 
 
 98 
 
 9912 
 
 917 
 
 921 
 
 926 
 
 930 
 
 934 
 
 939 
 
 943 
 
 948 
 
 952 
 
 99 
 
 9956 
 
 961 
 
 965 
 
 969 
 
 974 
 
 978 
 
 983 
 
 987 
 
 991 
 
 996 
 
 See explanation at the end of this section. 
 
THE USE OF LOGARITHMS .45 
 
 In the table preceding, the figures in the column headed 
 "N" denote the numbers whose logarithms are given. These 
 numbers must be considered in conjunction with the num- 
 bers at the top of the remaining ten columns ; in other words, 
 we can find the logarithm not only of the number (say) 34, 
 but also of 34.1, 34.2, 34.3, etc., and similarly of .34, .341, 
 .342, .343, etc., and of 3,400, 3,410, 3,420, 3,430, etc. 
 
 The figures in the columns headed "0," "1,'' "2," etc., 
 represent simply the decimal parts (or mantissas) of the 
 logarithms; the whole (or integral) parts of the logarithms 
 must always be determined by inspection (§41). 
 
 The column headed "0" has four places of figures, while 
 the following columns have only three places. This is done 
 to save space, since a fourth figure is assumed to be pre- 
 fixed, this figure being the same as the first figure in the 
 four-place column. There is an exception to this rule in the 
 case of figures prefixed by an asterisk, and three or four 
 examples will serve to make this clear: 
 
 Corresponding 
 Number Logarithm 
 
 2.50 .3979 
 
 2.51 .3997 
 
 2.52 .4014 (not .3014) 
 
 2.53 .4031 (not .3031) 
 etc. etc. 
 
 § 44. Multiplication by Logarithms 
 
 As stated in § 40, there are four general rules regarding 
 logarithms, and these will now be illustrated in order. 
 
 Rule 1: The sum of the logarithms of two or more 
 numbers is the logarithm of their product. 
 
46 THE MATHEMATICS OF INVESTMENT 
 
 2 nl .3010 
 
 3 nl .4771 
 
 2X3 
 
 6 nl 
 
 .778t 
 
 
 4 nl 
 
 .6021 
 
 
 14 nl 
 
 1.1461 
 
 4X14 
 
 56 nl 
 
 1.7482 
 
 
 5 w/ 
 
 .6990 
 
 
 20 nl 
 
 1.3010 
 
 6X20 
 
 100 w/ 
 
 2.0000 
 
 In these and other illustrations, there may be apparent 
 errors in the final decimal figure, due to throwing away or 
 adding on parts of decimals, as the case might be. For 
 example, in the first illustration given above, the logarithm 
 of 2 to six places is .301030, and the logarithm of 3 is 
 .477121; the logarithm of 6, the product, is .778151. 
 
 § 45. Division by Logarithms 
 
 The logarithm of a product is obtained by finding the 
 sum of the logarithms of the factors, and, as division is the 
 converse of multiplication, the logarithm of a quotient is 
 obtained by finding the difference between the logarithms 
 of the dividend and divisor. 
 
 Rule 2 : The difference of the logarithms of two num- 
 bers is the logarithm of their quotient. 
 
 Required the quotient of 6 -^ 2. 
 6 nl .7782 
 2 nl .3010 
 6-^2 nl .4771 In 3 
 
 Required the quotient of 42 -^ 14. 
 42 nl 1.6232 
 14 nl 1.1461 
 42-^14 nl .4771 In 3 
 
THE USE OF LOGARITHMS 47 
 
 Required the quotient of 100 -^- 4. 
 100 nl 2.0000 
 4 nl .6021 
 100-^4 fil 1.3979 In 25 
 
 § 46. Powers by Logarithms 
 
 Rule 3 : The logarithm of the power of a number is equal 
 to the logarithm of the number multiplied by the exponent 
 of the power. 
 
 Let it be required to find the third power of 2, that is, 
 2', or the product of 2 X 2 X 2. 
 
 2 nl .3010 
 2' w/ 3 X .3010 
 
 or, .9030 In 8 
 
 Required the fourth power of 5, that is, 5*. 
 5 nl .6990 
 5' nl 4 X. 6990 
 
 or, 2.7960 In 625 
 
 It has been observed in this connection (§ 38), that the 
 second power is usually called the square, and the third 
 power the cube. 
 
 § 47. Roots by Logarithms 
 
 The fourth general rule regarding logarithms refers to 
 the extraction of roots. We have seen in §38 that, if a 
 certain number is a power of another, we call the latter 
 number a root of the former. For example, since 2 X 2 X 
 2 X 2 X 2 = 32, it is said that 32 is the 5th power of 2, and 
 that the 5th root of 32 is 2. The usual way of expressing 
 this latter fact is : 
 
 V32 = 2 
 or, 32^ = 2 
 
48 THE MATHEMATICS OF INVESTMENT 
 
 With the above explanation, the fourth rule is now 
 stated, and it will be observed that it is the converse of the 
 third rule. 
 
 Rule 4 : The logarithm of the root of a number is equal 
 to the logarithm of the number divided by the index of the 
 root. 
 
 As an illustration, let it be required to find the square 
 root of 49. 
 
 49 • nl 1.6902 
 V49, or 49'^ nl 1/2 of 1.6902 
 
 or, .8451 In 7 
 
 Required the cube root of 512. 
 
 512 nl 2.Y093 
 
 V512, or 512^ nl Ys of 2.7093 
 
 or, .9031 In 8 
 
 § 48. Fractional Exponents 
 
 Such an exponent as % requires explanation. It signi- 
 fies the third power of the fourth root, or the fourth root 
 of the third power. Thus, the value of 10^* may be ascer- 
 tained by finding the fourth root of 10, and then getting the 
 cube of this root; or by finding the cube of 10, which is 
 1,000, and then taking the fourth root (or the square root 
 of the square root) of 1,000. By the methods of arithmetic, 
 the value of lO''^ is thus found to be 5.62+; or, in other 
 words, the logarithm of 5.62 is approximately .75. It is 
 interesting to compare this result with the table in § 43, 
 where it is indicated that the logarithm of 5.62 is .7497, 
 which is very close to .7500. Fractional exponents may be 
 expressed as decimal, instead of common, fractions ; and, in 
 fact, that is what most logarithms are : simply fractional 
 exponents of 10, expressed decimally. 
 
THE USE OF LOGARITHMS 
 
 49 
 
 § 49. Use of Logarithms in Computing Compound Interest 
 
 To demonstrate the use of logarithms in compound in- 
 terest, let us take an example and work it out, illustrating 
 each step. We will take 3% as the rate, the same as already 
 used (§§25-30), but endeavor to find the amount for 50 
 periods, instead of for 4 periods. 
 
 The ratio of increase is 1.03. Looking for the logarithm 
 (to eight decimal places) of this ratio (Chambers' or Bab- 
 bage's tables, page 192) we find this line : 
 
 No. 0123456789 
 
 10300 0128 3722 4144 4566 4987 5409 5831 6252 6674 7096 7517 
 
 The meaning of this line is that the logarithms are as 
 follows : 
 
 1.03 
 
 nl 
 
 .01283722 
 
 1.03001 
 
 nl 
 
 .01284144 
 
 1.03002 
 
 nl 
 
 .01284566 
 
 1.03003 
 
 nl 
 
 .01284987, 
 
 1.03009 nl .01287517 
 
 The first figures of both the numbers and the logarithms 
 are given only once in the table, which saves space in print- 
 ing and time in searching. 
 
 Since 1.03 is to be taken as a factor 50 times, we must 
 multiply its logarithm by 50, as stated in Rule 3 (§46). 
 This gives : 
 
 50 X.01283722 = .6418610 
 
 The result is the logarithm of the answer; for, when we 
 have found the corresponding number, we shall know the 
 value of 1.03^^ 
 
 We must now look in the right-hand columns for the 
 logarithm figures .6418610. We first look for the 641, 
 which stands out by itself, overhanging a blank space 
 
so 
 
 THE MATHEMATICS OF INVESTMENT 
 
 (Chambers' or Babbage's tables, page 73), and we find that 
 
 the nearest approach to .6418610 is .6418606, which latter 
 
 is indicated as the logarithm of the number 4.3839. The 
 
 next nearest logarithm is .6418705, which corresponds to 
 
 the number 4.3840. The following tabulation shows the 
 
 details more clearly : 
 
 Corresponding 
 Logarithm Number 
 
 .6418606 4.3839 
 
 .6418610 To be determined 
 
 .6418705 4.3840 
 
 It is evident that the number to be determined lies be- 
 tween 4.3839 and 4.3840, which differ by .0001. The dif- 
 ference between the first and third logarithms is .0000099, 
 and between the first and second logarithms is .0000004. 
 For practical purposes, we take 4/99 of the difference 
 between the numbers (.0001), and add this amount to 
 the smaller number, thus obtaining the required number 
 4.383904. In order to assist in determining the decimal 
 value of 4/99 and similar fractions, little difference-tables 
 are usually given in the margins of the pages of logarithm 
 tables, the table for 99 reading as follows: 
 
 99 
 
 1 
 
 10 
 
 2 
 
 20 
 
 3 
 
 30 
 
 4 
 
 40 
 
 5 
 
 50 
 
 6 
 
 59 
 
 7 
 
 69 
 
 8 
 
 79 
 
 9 
 
 89 
 
 The meaning of this table is that 40/99 = .40; 4/99 = 
 
THE USE OF LOGARITHMS 5I 
 
 .04; 8/99 = .079 ; etc. By the use of these small tables, the 
 labor of dividing is thus avoided. 
 
 § 50. Accuracy of Logarithmic Results 
 
 The amount of $1.00 compounded for 50 periods at 3% 
 is seen to be $4.383904. The result is slightly inaccurate 
 in the last figure, for the reason that two decimal places were 
 lost by multiplying. Had we taken the ten-figure logarithm 
 
 on page XVIII of Chambers' tables 0128372247 
 
 this multiplied by 50 would give 641861235 
 
 or, rounded off at the 7th place 6418612 
 
 which gives the more accurate result 4.383906 
 
 § 51. Logarithms to Fifteen Places 
 
 Since it is necessary, for problems involving many 
 periods, to use a very extended logarithm, there is given in 
 Part III of the present volume, tables of fifteen-place loga- 
 rithms for a number of different ratios of increase (1 +i). 
 These are at much closer intervals than any table previously 
 published, and, with a ten-figure book of logarithms, will 
 give exact results to the nearest cent on $1,000,000.00. 
 
 § 52. Use of Logarithms in Present Worth Calculations 
 
 We will further exemplify the advantage of the loga- 
 rithmic method by solving a present worth problem. Let 
 it be required to find the present worth of $1.00 due in 50 
 periods, compounded at 3% per period. Multiplying the 
 logarithm of 1.03 by 50, just as in § 50, we obtain 
 .641861235. But it is the reciprocal of 1.03'^ or 1 -^ 
 1.03^^ which we wish to obtain; hence we must subtract 
 .641861235 from the logarithm of 1, which is 0. 
 
 0.000000000 
 0.641861235 
 
 Remainder, 1.358138765 
 
52 THE MATHEMATICS OF INVESTMENT 
 
 In subtracting a greater from a less logarithm, we get a 
 negative whole number (as shown by the minus above), the 
 decimal part being positive and obtained by ordinary 
 subtraction. 
 
 Neglecting the 1, for the moment, we search in the right- 
 hand column for .358138765, and find that .3581253 is the 
 logarithm of 2.2810; and proceeding as in §50, we find 
 that .3581388 is the logarithm of 2.281071. The decimal 
 point, however, must be moved one place to the left, as 
 directed by the characteristic 1; thus giving as the final 
 result, .2281071. 
 
 By means of multiplication, we may check the results 
 shown in this and the foregoing sections. 
 
 By §50, 1.03'Ms 4.383906 
 
 As above, 1 -^ 1.03'" is. . . .2281071 
 
 Since these two results are reciprocals, their product should 
 equal unity, or 1. The result of the multiplication is 
 1.0000000843326, which verifies the accuracy of the 
 previous computations. 
 
CHAPTER IV 
 
 AMOUNT OF AN ANNUITY 
 
 § 53. Evaluation of a Series of Payments 
 
 We have now investigated the two fundamental prob- 
 lems in compound interest, viz. : to find the amount of a 
 present worth, and to find the present worth of an amount. 
 The next question is a more complex one: to find the 
 amount and the present worth of a series of payments. If 
 these payments are irregular as to period, value, and rate 
 of interest, the only way of finding the amount or the present 
 worth of the series is to make as many separate computa- 
 tions as there are payments, and then find the sum of the 
 results obtained. But, if the payments, periods, and rates 
 of interest are uniform, we can devise a method for finding 
 by one operation the amount or present worth of the 
 whole series. 
 
 § 54. Annuities 
 
 A series of payments of like amounts, made at regular 
 periods, is called an annuity ; the period does not necessarily 
 need to be a year, but may be a half-year, a quarter, or any 
 other length of time. Thus, if an agreement is made pro- 
 viding for the following payments : 
 
 September 9, 1914 $100.00 
 
 March 9, 1915 100.00 
 
 September 9, 1915 100.00 
 
 March 9, 1916 100.00 
 
 53 
 
54 THE MATHEMATICS OF INVESTMENT 
 
 there would be an annuity of $200.00 per annum, payable 
 semi-annually; or, in other words, an annuity of $100.00 for 
 each half-year period, terminating after four periods. As- 
 -suming the rate of interest to be 6% per annum, payable 
 semi-annually (3% per period), let us suppose that it is 
 required to find the total amount to which the annuity will 
 have accumulated on March 9, 1916, and the present worth, 
 on March 9, 1914, of this series of future payments. It is 
 evident that the answer to the first question will be greater 
 than $400.00, and that the answer to the second question, as 
 shown in the next chapter, will be less than $400.00. 
 
 § 55. Amount of Annuity 
 
 It is easy, in this case, to find the separate amounts of 
 the payments, since the number of terms is very small and 
 since we may avail ourselves of the computations in § 30. 
 A schedule could be made as follows : 
 
 Date of Payment Amount at March 9, 1916 
 March 9, 1916 $100.00 
 
 September 9, 1915 103.00 
 
 March 9, 1915 106.09 
 
 September 9, 1914 109.2727 
 
 Total, $418.3627 
 
 § 56. Calculation of Annuity Amounts 
 
 If, however, there were 50 terms instead of 4, the work 
 of computing these 50 separate amounts, by the use of loga- 
 rithms, or by the shorter process (in this case) of simple 
 multiplication, would be very tedious. To shorten the process 
 let us make up three columns of amounts for four periods, 
 the first being amounts of $1.00, the second being amounts 
 of $1.03, and the third being amounts of $.03. The figures 
 in the second column will accordingly be 1.03 times the 
 
AMOUNT OF AN ANNUITY 
 
 55 
 
 corresponding figures in the first column, while the figures 
 in the third column will be the difference between the corre- 
 sponding figures in the first two columns. 
 
 (1> 
 
 Amounts 
 of $1.00 
 
 (2) 
 
 Amounts 
 
 of $1.03 
 
 (3) 
 
 Amounts 
 
 of $.03 
 
 $1.00 
 1.03 
 1.0609 
 1.092727 
 
 Total, $4.183627 
 
 $1.03 
 1.0609 
 1.092727 
 1.12550881 
 
 $4.30913581 
 
 $.03 
 .0309 
 .031827 
 .03278181 
 
 $.12550881 
 
 § 57. Formation of Tables 
 
 We may take the diflFerence between the totals of 
 columns (1) and (2) without actually finding these totals. 
 It will be observed that the first three items in column (2) 
 are the same as the last three items of column (1). The 
 difference between the totals of the two columns, therefore, 
 is the same as the difference between the last item of (2) and 
 the first item of (1); that is, $1.12550881 less $1.00, or 
 $.12550881. This latter figure equals the total of column 
 (3). 
 
 § 58. Use of Tables 
 
 It is evident that an annuity of three cents will amount, 
 under the conditions assumed, to twelve cents and the 
 decimal .550881. Accordingly, an annuity of one cent will 
 amount to one-third of $.12550881, or $.04183627. An 
 annuity of $1.00 will amount to 100 times as much, or 
 $4.183627, while an annuity of $100.00 will amount to 
 $418.3627, which agrees exactly with the result obtained by 
 addition, in § 55. 
 
56 THE MATHEMATICS OF INVESTMENT 
 
 § 59. Compound Interest as a Base for Annuity Calculations 
 
 The amount $.12550881 (obtained by subtracting $1.00 
 from $1.12550881) is the compound interest on $1.00 for 
 the given rate and time, and the amount $.03 is the single 
 interest. The compound interest on $1.00, compounded 
 semi-annually at 6%, up to any time corresponds with the 
 amount of an annuity of three cents, payable on exactly 
 the same plan. The amount of the annuity of $1.00 is 
 $.12550881-^.03, or $4.183627; and from this we formu- 
 late the rule given in the following section. 
 
 § 60. Rule and Formula for Finding Amount 
 
 To find the amount of an annuity of $1.00 for a given 
 
 time and at a given rate, divide the compound interest for 
 
 the total number of periods, by the single interest for one 
 
 period, both expressed decimally. 
 
 To express the rule in a formula, let A represent the 
 
 amount, not of a single $1.00, but of an annuity of $1.00; 
 
 then A = I -T- i. 
 
 § 61. Operation of Rule 
 
 To illustrate, let us take the case worked out in § 50, 
 where we found the amount of a single dollar at 3%, for 50 
 
 periods, to be. $4.383906 
 
 Subtracting one dollar 1.000000 
 
 The compound interest is , $3.383906 
 
 Divide this by .03 and we have $112.79687 
 
 which is the amount to which 50 payments of $1.00 each, 
 at 3% per period, would accumulate. 
 
CHAPTER V 
 
 PRESENT WORTH OF AN ANNUITY 
 
 § 62. Method of Calculation 
 
 To find the present worth of an annuity, we can, of 
 course, find the present worth of each payment, and then, 
 by addition, find the total present worth of all the payments ; 
 but it will save much labor if we compute the total in one 
 operation, as we computed the amount, and a similar course 
 of reasoning will lead to the desired result. 
 
 § 63. Tables of Present Worth 
 
 In the second column of the following table is shown 
 the present worth of $1.00 for 4, 3, 2 and 1 period, respec- 
 tively, at 3% per period ; and in the third and fourth columns 
 are shown similar values of $1.03 and $.03, respectively. 
 
 (1) 
 
 Number 
 
 of 
 Periods 
 
 (2) 
 Present 
 Worths 
 of $1.00 
 
 (3) 
 Present 
 Worths 
 of $1.03 
 
 (4) 
 Present 
 Worths 
 of $.03 
 
 4 
 3 
 2 
 1 
 
 $.888487 
 .915142 
 .942596 
 .970874 
 
 $3.717099 
 
 $.915142 
 .942596 
 .970874 
 
 1.000000 
 
 $.026655 
 .027454 
 .028278 
 .029126 
 
 Total, 
 
 $3.828612 
 
 $.111513 
 
 57 
 
58 THE MATHEMATICS OF INVESTMENT 
 
 § 64. Short Method for Finding Present Worth of an 
 
 Annuity 
 
 Since the last three items in column (2) are the same 
 as the first three items in column (3), it is evident that, in 
 order to obtain the difference between the totals of columns 
 (2) and (3), it is not necessary to make the actual additions 
 of these columns, but merely to find the difference between 
 the items not found in both columns. These items are only 
 two, viz., $.888487 in the second column, and $1.000000 in 
 the third column. Their difference is $.111513, which agrees 
 with the total found by the addition of column (4). 
 
 § 65. Present Worth Obtained 
 
 The difference between the $.888487 of the second 
 column and $1.000000 of the third column, amounting to 
 $.111513, is the compound discount of $1.00 for four 
 periods at 3%. When this difference is divided by the single 
 interest (.03), we obtain $3.71710, which is the same result 
 (rounded up) as that obtained by adding column (2). From 
 this observation, we construct the rule given in the following 
 section : 
 
 § 66. Rule for Present Worth 
 
 To find the present worth of an annuity of $1.00 for a 
 given time at a given rate, divide the compound discount for 
 that time and rate by the single interest for one period, both 
 expressed decimally. 
 
 § 67. Formulas for Present Worth 
 
 In symbols, the rule may be expressed, P = D -^ /. Since, 
 by § 35, D = I -^ a, we obtain F = l-^a-^i, or P = I-^ 
 i -f- a. And since, by § 60, A = I -^- i, there comes the re- 
 sulting symbolic rule, P = A -^- a, the latter part of this 
 equation signifying the present worth of the amount of the 
 
PRESENT WORTH OF AN ANNUITY 59 
 
 annuity. Summarizing, therefore, we have the two symbolic 
 rules : 
 
 P = A-f-a 
 
 § 68. Analysis of Annuity Payments 
 
 It may assist in acquiring a clear idea of the working of 
 an annuity, if an analysis is given of a series of annuity pay- 
 ments from the point of view of the purchaser. For this 
 purpose we will suppose that a person investing $3.7171 
 at 3%, in an annuity of $1.00 per period, payable at the 
 end of each period, expects to receive at each payment, be- 
 sides 3% on his principal to date, a portion of that principal, 
 and thus to have his entire principal gradually repaid. 
 
 His original principal is , $3.7171 
 
 At the end of the first period, he receives : 
 
 3% on $3.7171 $.1115 
 
 Payment on principal 8886 .8885 
 
 Total $1.0000 
 
 Leaving new principal (which is equiva- 
 lent to the present worth at three periods) $2.8286 
 
 At the end of the second period, he receives : 
 
 3% on $2.8286 $.0849 
 
 Payment on principal ,..,.. .9151 .9151 
 
 Total $1.0000 
 
 Leaving new principal $1.9135 
 
 At the end of the third period, he receives : 
 
 3% on $1.9135 $.0574 
 
 Payment on principal 9426 .9426 
 
 Total $1.0000 
 
 Leaving new principal $.9709 
 
6o THE MATHEMATICS OF INVESTMENT 
 
 At the end of the last period, he receives : 
 
 3% on $.9709 $.0291 
 
 Payment on principal in full 9709 .9709 
 
 Total $1.0000 
 
 In the above manner we find that the annuitant has re- 
 ceived interest in full on the principal outstanding, and has 
 also received the entire original principal. The correctness 
 of the basis on which we have been working is thus 
 corroborated. 
 
 § 69. Components of Annuity Instalments 
 
 It is usual to form a schedule showing the components 
 of each instalment in tabular form : 
 
 Date 
 
 Total 
 Payment 
 
 Payments 
 
 of 
 
 Interest 
 
 Payments 
 
 on 
 Principal 
 
 Principal 
 
 Out- 
 standing 
 
 March 9, 1914. 
 September 9, 1914. 
 March 9, 1915. 
 September 9, 1915. 
 March 9, 1916. 
 
 $1.00 
 1.00 
 1.00 
 1.00 
 
 $4.00 
 
 $.1115 
 .0849 
 .0574 
 .0291 
 
 $.2829 
 
 $.8885 
 .9151 
 .9426 
 .9709 
 
 $3.7171 
 
 $3.7171 
 2.8286 
 1.9135 
 0.9709 
 0.0000 
 
 Had the purchaser reinvested each instalment at 3%, he 
 would have, at the end, $4.1836 (§55), which is equivalent 
 to his original investment compounded ($3.7171 X 1.1255 = 
 $4.1836). 
 
 § 70. Amortization 
 
 The payments on principal are known as amortization, 
 which may be defined as the gradual repayment of a principal 
 sum through the resultant operation of two opposing forces 
 — ^periodical payments and compound interest. The effect 
 
PRESENT WORTH OF AN ANNUITY 6l 
 
 of the periodical payments is to reduce the principal sum, 
 while the effect of the compound interest is to increase it. 
 In ordinary compound interest, each new principal is greater 
 than the preceding principal ; while in the case of amortiza- 
 tion, each principal is less than the preceding one. 
 
 § 71. Amortization and Present Worth 
 
 It will be noticed, from § 69, that each payment on 
 principal, or amortization, for one period, is the present 
 worth of the instalment at the beginning of its period. For 
 example, at the end of the first period, September 9, 1914, a 
 payment on principal is made amounting to $.8885, which 
 is the present worth of the instalment paid on that date 
 ($1.00) for four periods at 3%. From this fact, it follows 
 that, if we know the amount of the instalment, the rate, and 
 the number of remaining periods, we can calculate the 
 amortization included in the instalment. 
 
 § 72. Development of a Series of Amortizations 
 
 It will also be noticed that each amortization multiplied 
 by 1.03 becomes the next following, these being a series of 
 present worths ; and that thus they may be derived from one 
 another, upwards or downwards. 
 
 § 73. Evaluation by Logarithms 
 
 In § 52, by the use of logarithms, we found the present 
 worth of $1.00 for 50 periods, at 3%, to be. . $.2281071 
 Subtracting this from 1.0000000 
 
 we have the compound discount ,. ., , $.7718929 
 
 Dividing this by .03, we have $25.72976 + 
 
 which is the present worth of an annuity of $1.00 for 50 
 periods, at 3%. Thus we see that the process of finding the 
 present worth of an annuity, or, as it is termed, evaluation, is 
 rendered easy — no matter how long the time — by using 
 logarithms. 
 
CHAPTER VI 
 
 SPECIAL FORMS OF ANNUITIES 
 
 § 74. Ordinary or Immediate Annuities 
 
 The annuities heretofore spoken of are payable at the 
 end of each period, and are the kind most frequently occur- 
 ring. To distinguish them from other varieties, they are 
 spoken of as ordinary or immediate annuities. 
 
 § 75. Annuities Due 
 
 When the instalments of an annuity are payable at the 
 beginning of their respective periods, the annuity is called 
 an annuity due, although prepaid would seem more natural. 
 It is evident that this is merely a question of dating. The 
 instalments compared with those in § 56 are as follows : 
 
 
 Immediate 
 
 Annuity 
 
 Immediate 
 
 
 Annuity 
 4 Periods 
 
 Due 
 4 Periods 
 
 Annuity 
 5 Periods 
 
 r 
 
 $1.00 
 
 $1.03 
 
 $1.00 
 
 Amounts of 
 
 1.03 
 1.0609 
 
 1.0609 
 1.0927 
 
 1.03 
 
 1.0609 
 
 $1.00 
 
 1.0927 
 
 1.1255 
 
 1.0927 
 
 
 
 
 1.1255 
 
 
 $5.3091 
 
 
 
 
 — 1.0000 
 
 
 $4.1836 
 
 $4.3091 
 
 $4.3091 
 
 62 
 
SPECIAL FORMS OF ANNUITIES 
 
 63 
 
 Hence, to find the amount of an annuity due, for any 
 number of periods, say t periods, find the amount of an 
 immediate annuity for ^ + 1 periods, and subtract one 
 instalment. 
 
 § 76. Present Worth of Annuities Due 
 
 In regard to present worths, the instalments compared 
 with those in § 63 would be as follows : 
 
 
 Immediate 
 
 Annuity 
 4 Periods 
 
 Annuity- 
 Due 
 4 Periods 
 
 Immediate 
 
 Annuity 
 
 3 Periods 
 
 Present 
 Worths of - 
 $1.00 
 
 $.888487 
 .915142 
 .942596 
 .970874 
 
 $.915142 
 .942596 
 .970874 
 
 1.000000 
 
 $.915142 
 .942596 
 
 .970874 
 
 
 $2.828612 
 + 1.000000 
 
 
 $3.717099 
 
 $3.828612 
 
 $3.828612 
 
 Therefore, to find the present worth of an annuity dtw 
 for / periods, find the present worth of an immediate annuity 
 for ; — 1 periods, and add one instalment. 
 
 § 77. Present Worth of Deferred Annuities 
 
 A deferred annuity is one which does not commence to 
 run immediately, but only after a certain number of periods 
 have elapsed. Thus, an annuity of 5 terms, 4 terms deferred, 
 would commence at the beginning of the fifth period, and 
 continue to the end of the ninth period. 
 
 If there were nine terms in the annuity, none being de- 
 ferred, and if the ratio of increase were assumed to be r and 
 
64 THE MATHEMATICS OF INVESTMENT 
 
 the present worth of the first term were assumed to be 
 unity, the present worth of the annuity for nine terms 
 would be : 
 
 l+7 + ^ + ;;:i + ;:5 + J + ^ + J + ^(§§ 18, 66) 
 The present worth of the annuity for four terms would be : 
 
 The present worth of the annuity for the five deferred terms 
 would, of course, be the difference between the above two 
 sums, or: 
 
 i+l+i.i.i 
 
 ^4 ~ ^5 ~ ^6 I ^7 I ^8 
 
 § 78. Rule for Finding Present Worth of Deferred Annuity 
 From the foregoing, we derive the rule: To find the 
 present worth of an annuity for m terms, deferred for n 
 terms, subtract the present worth of an annuity for n terms 
 from the present worth of an annuity for m-\- n terms. 
 
 § 79. Present Worth of Perpetuities 
 
 A perpetual annuity, or a perpetuity, is one which never 
 terminates. Its amount is infinity, but its present worth can 
 be calculated at any given rate of interest. If each instalment 
 of an annuity is $1.00* and the rate 5%, the value of the 
 annuity is such a sum as will produce $1.00 at that rate. 
 This sum is $20.00, being $1.00 -f- 6%. The compound dis- 
 count is the entire $1.00, being for an infinite number of 
 terms. Therefore, the rule of § 66 still holds true : divide 
 the compound discount by the single rate of interest, in order 
 to find the present worth of the annuity. 
 
SPECIAL FORMS OF ANNUITIES 65 
 
 § 80. Perpetuity in Stock Purchased for Investment 
 
 A share of stock may be treated in the same manner as a 
 perpetuity, provided its dividend is assumed to continue at 
 a fixed rate. If the dividend is $4.00 per share, and if it is 
 desired to purchase at such a basis as to yield 6% on the 
 investment, the price per share should be $4.00-^-6%, which 
 equals $66.67. This price is irrespective of the nominal or 
 par value of the stock. Both in perpetuities and in shares of 
 stock, the price = c-^i. 
 
 §81. When Annuity Periods and Interest Periods Differ 
 
 In all of these examples of annuities, it has been assumed 
 that the term or interval between payments is the same 
 length of time as the interest period. It frequently happens, 
 however, that the rate of interest is stated to be so much per 
 year, while the payments are half-yearly or quarterly; or 
 there may be yearly payments, while the desired interest 
 rate is to be on a half-yearly basis. We shall defer the treat- 
 ment of these latter cases until the subject of nominal and 
 effective rates of interest has been discussed. 
 
 § 82. Varying Annuities 
 
 There may also be varying annuities, where the instal- 
 ment changes by some uniform law. These seldom occur 
 in practice. Where the change is simple, as in arithmetical 
 progression, the total annuity may be regarded as the sum 
 of several partial annuities; otherwise the values must be 
 separately calculated for each term. An annuity running 
 for five terms, as follows : 13, 18, 23, 28, 33, may be re- 
 garded as the sum of the following : 
 
 (1) an annuity of 13 for 6 terms; 
 
 (2) an annuity of 5 for 4 terms; 
 
66 THE MATHEMATICS OF INVESTMENT 
 
 (3) an annuity of 5 for 3 terms; 
 
 (4) an annuity of 5 for 2 terms; and 
 ;(5) an annuity of 5 for 1 term. 
 
 In actual practice, in a case of this kind, in order to find 
 the amount or the present worth of the annuity, it would 
 probably be easiest to find the amount or the present worth 
 of each term, and then find the total of these separate items. 
 
CHAPTER VII 
 RENT OF ANNUITY AND SINKING FUND 
 
 § 83. Rent of Annuity 
 
 The number of dollars in each separate payment of an 
 annuity is called the rent of the annuity. 
 
 In § 63, we saw that $3.Y171 is the present worth, at 
 3%, of an annuity composed of 4 payments of $1.00 each. 
 We may reverse this and say that $1.00 is the rent of 
 $3.7171 invested in an annuity of 4 payments at 3%. What, 
 then, is the rent to be obtained by investing $1.00 in the 
 same way? Since the present worth has been reduced in 
 the ratio of 3.7171 to 1, evidently the rent must be reduced 
 in the same ratio, that is, 1 -^ 3.7171. By ordinary division 
 or by logarithms, this quotient is .26903. Therefore, 
 $.26903 is the rent of an annuity of 4 terms at 3%, for 
 every $1.00 invested; or $1.00 is the present worth at 3% 
 of an annuity for 4 years of $.26903. This may be illus- 
 trated by making up a schedule : 
 
 
 Rent 
 
 Interest 
 
 Reduction 
 or Amorti- 
 zation 
 
 Value 
 
 Beginning of first period. 
 
 End of first period 
 
 End of second period 
 
 End of third period 
 
 End of fourth period 
 
 $ .26903 
 .26903 
 .26903 
 .26903 
 
 $.03 
 .02283 
 
 .01544 
 .00785 
 
 $ .23903 
 .24620 
 .25359 
 .26118 
 
 $1.00000 
 
 .76097 
 
 .51477 
 
 .26118 
 
 0. 
 
 
 $1.07612 
 
 $.07612 
 
 $1.00000 
 
 
 67 
 
(^ THE MATHEMATICS OF INVESTMENT 
 
 § 84. Rule for Finding Rent of Annuity 
 
 To find the rent of an annuity valued at $1.00, divide 
 $1.00 by the present worth of an annuity of $1.00 for the 
 given rate and time. Rent = 1 -> P ; and since, by § 67, 
 P = D ^ i^ and F = A-7- a, we obtain two other symbolic 
 rules : 
 
 Rent = i-^D 
 
 Rent = a -^- A 
 
 § 85. Alternative Method of Finding Rent 
 
 An alternative method of determining the value of the 
 rent of an annuity is to form a proportion, as in arithmetic, 
 and then solve the proportion. For example : 
 
 Rent of Annuity Present Worth of Annuity 
 $1.00 : X :: $3.7171 : $1.00 
 
 In other words, if a rent of $1.00 produces a present worth 
 of $3.7171, then what quantity of rent will produce a present 
 worth of $1.00? Multiplying the two extremes together, 
 and dividing the product by the mean, we find the other 
 mean to be $.26903, which is the rent required. 
 
 § 86. Rent of Deferred Payments 
 
 The problem of finding the rent of an annuity may be 
 regarded as equivalent to another problem — that of finding 
 how much per period for n periods, at the rate i, can be 
 bought for $1.00. A borrower may agree to pay back a loan 
 in instalments, each of which comprises both principal and 
 interest. Suppose that a loan of $1,000 were made under 
 the agreement that such a uniform sum should be paid 
 annually as would pay off (amortize) the entire debt with 
 3% interest in 4 years. The present worth is, of course, 
 $1,000, and by the above process each instalment or con- 
 tribution would be $269.03. In countries imposing an in- 
 
RENT OF ANNUITY AND SINKING FUND 
 
 69 
 
 come tax, it is usual to incorporate in agreements of this 
 nature a schedule showing what part of the instalment is 
 interest — since that alone is taxable — somewhat as follows : 
 
 
 Annual 
 Instalment 
 
 [nterest on 
 Balance 
 
 Payment on 
 Principal 
 
 Principal 
 Outstanding 
 
 January 1, 1914 
 December 31, 1914 
 December 31, 1915 
 December 31, 1916 
 December 31, 1917 
 
 $269.03 
 269.03 
 269.03 
 269.03 
 
 $30.00 
 22.83 
 
 15.44 
 
 7.85 
 
 $239.03 
 246.20 
 253.59 
 261.18 
 
 $1,000.00 
 
 760.97 
 
 514.77 
 
 261.18 
 
 0. 
 
 
 $1,076.12 
 
 $76.12 
 
 $1,000.00 
 
 
 § 87. Annuities as Sinking Funds 
 
 One other question arises with regard to annuities, and 
 that is in the cnse of an annuity so constructed as to accumu- 
 late to a certain amount at a certain time. The amount to 
 be accumulated is called a sinking fund. Frequently the 
 uniform periodical contribution is itself called the sinking 
 fund, but, more strictly speaking, it should be called the 
 sinking fund contribution. 
 
 In the case exhibited in the schedule of § 86, the debt 
 was amortized, with the assent of the creditor, by gradual 
 payments. Let us suppose, however, that the creditor pre- 
 fers to wait until the day of maturity, and receive his $1,000 
 all at one time, instead of by partial payments. The debtor 
 must pay interest amounting to $30.00 each year, but, in 
 addition to this, in order to provide for the principal on a 
 sinking fund plan, he must transfer from his general assets 
 to a special account (or into the hands of a trustee) such 
 an annual sum as will accumulate, in 4 years at 3%, to 
 $1,000. Since $1.00, set aside annually, amounts, after 4 
 
70 
 
 THE MATHEMATICS OF INVESTMENT 
 
 years on a 3% basis, to $4.183627 (§56), to find what 
 sum will similarly amount to $1,000, we must divide 1,000 
 by 4.183627. In this manner the sinking fund contribution 
 is found to be $239.03. 
 
 § 88. Rule for Finding Sinking Fund Contributions 
 
 To find what annuity will amount to $1.00, or what 
 should be each sinking fund contribution to provide for 
 $1.00: divide $1.00 by the amount of an annuity of $1.00 
 for the given rate and time. In symbols, sinking fund con- 
 tribution, or S. F. C, = 1 -^ A ; or (since A = I ^i, per 
 § 60) it also equals i -h I. 
 
 Put in the form of a proportion, the question of § 87 
 would appear as follows : 
 
 Sinking Fund Contribution 
 $1.00 : X :: 
 
 Sinking Fund 
 $4.183627 : $1,000.00 
 
 The unknown quantity, x, would be the same as before, 
 $239.03. 
 
 § 89. Verification Schedule 
 
 The correctness of the result found in § 87 may be proved 
 by a schedule constructed in the following manner : 
 
 
 Annual Sink- 
 ing Fund 
 Contribution 
 
 Interest Dur- 
 ing Preced- 
 ing Year 
 
 Total 
 Addition 
 to Sinking 
 Fund 
 
 TotalAmount 
 Accumulated 
 in Sinking 
 Fund 
 
 January 1, 1914 
 December 31, 1914 
 December 31, 1915 
 December 31, 1910 
 December 31, 1917 
 
 $239.03 
 239.03 
 239.03 
 239.03 
 
 $ 7.17 
 14.56 
 22.15 
 
 $239.03 
 246.20 
 253.59 
 261.18 
 
 $ 0. 
 239.03 
 485.23 
 738.82 
 
 1,000.00 
 
 
 $056.12 
 
 $43.88 
 
 $1,000.00 
 
 
RENT OF ANNUITY AND SINKING FUND 
 
 71 
 
 § 90. Amortization and Sinking Fund 
 
 On comparing the schedules in §§ 86 and 89, we find 
 that the annual instalments or contributions are respectively 
 $269.03 and $239.03, the difference of which is $30.00, or 
 exactly the yearly interest on the original loan of $1,000.00. 
 Hence, the amount paid in the second case, if interest be 
 included, is just the same as in the first case. Gradual pay- 
 ments on account of a debt, or gradual accumulations hav- 
 ing in view one single final payment in full, therefore amount 
 to the same thing. 
 
 As a provision for liquidating indebtedness, or for re- 
 placing vanishing assets, sinking fund and amortization are 
 two different applications of the same principle. Formerly, 
 the terms were used interchangeably, but more recently they 
 are distinguished as follows : 
 
 (1) The sinking fund method permits the debt to stand 
 until maturity, but in the meantime accumulates a fund 
 which at maturity pays off the entire debt, the interest on 
 the original sum being paid separately. 
 
 (2) The amortization method accumulates nothing, but 
 gradually reduces the debt, the amount of the reduction 
 being the excess of the periodical payment over the 
 periodical interest. 
 
CHAPTER VIII 
 
 NOMINAL AND EFFECTIVE RATES 
 
 § 91. Explanation of Terms 
 
 In the previous chapters, all of our computations re- 
 garding interest have been based upon a certain number of 
 periods and upon a certain rate per period. In the business 
 world, it is usual to speak of interest rates as so much per 
 annum. In the vast majority of instances, however, the in- 
 terest, although it is either designated or understood to be 
 per annum, is, nevertheless, not paid by the year (that is, 
 once a year), but in semi-annual or quarterly instalments. 
 Where the interest is payable otherwise than annually, the 
 rate per annum is only nominally correct. For example, if 
 on May 1, 1914, we lend $1,000.00 at 6%, interest to be paid 
 semi-annually, the interest account for the year would be 
 as follows : 
 
 November 1, 1914, Interest earned. . ., ,. . $30.00 
 
 May 1, 1915, Interest earned: 
 
 On original loan , 30.00 
 
 On the $30.00 received on November 1, 1914, 
 
 for 6 months at an assumed rate of 6% ... . .90 
 
 Total $60.90 
 
 The total interest earnings during the year, therefore, 
 would be $60.90, which is at the effective rate of 6.09% 
 on the original investment, as compared with a nominal 
 rate of 6%. 
 
 72 
 
fjj 
 
 NOMINAL AND EFFECTIVE RATES 
 
 73 
 
 § 92. Semi-Annual and Quarterly Conversions 
 
 In the example given in the preceding section, the in- 
 terest is payable (or, as it is frequently called, convertible) 
 semi-annually. The true or effective rate for each half- 
 yearly period is therefore 3%, and the ratio of increase is 
 1.03. The amount at the end of the year would be the 
 square of 1.03, or 1.0609, thus giving 6.09% as the effective 
 rate per annum. In the case of quarterly conversion, the 
 amount at the end of the year v^ould be the fourth power of 
 1.015, or 1.061364, giving 6.1364=% as the effective annual 
 rate. The following table shows the effective annual rates 
 for various periods of conversion, the nominal annual rate 
 being 6% : 
 
 Period of ^^ . . , r> . 
 
 ^ . Effective Annual Rate 
 Conversion 
 
 Yearly 1.06 — 1 or 6.0000% 
 
 Semi-annually 1.03' — 1 or 6.0900% 
 
 Quarterly 1.015* — 1 or 6.1364% 
 
 Monthly , 1.005'^ — 1 or 6.1678%? 
 
 Y 365/ 
 
 Daily f 1+-^ I —1 or 6.1826% 
 
 § 93. Limit of Effective Annual Rate 
 
 It will be seen that the effective rate increases as the 
 conversions become more frequent. There is a limit, how- 
 ever, beyond which this acceleration will not go. If an in- 
 vestment on a 6% nominal annual rate is compounded every 
 minute, or every second, or every millionth of a second, or 
 constantly, the effective annual rate could never be so great 
 as 6.184%.* 
 
 'See § 238. 
 
74 
 
 THE MATHEMATICS OF INVESTMENT 
 
 § 94. Rule for Effective Rate 
 
 From observation of the table shown in § 92, we may 
 deduce the following symbolic rule for finding the effective 
 rate, m representing the number of payments per annum, 
 and y the effective rate : 
 
 =(i+i)'"- 
 
 § 95. Logarithmic Process 
 
 In order to exemplify logarithmic processes in working 
 out the foregoing rule, let it be required to find the effective 
 rate of interest when the nominal rate is 6% per annum, 
 compounded daily. The rule in § 94 then becomes : 
 
 By the use of logarithms, we obtain : 
 
 log. .06 =2.7Y81513 
 
 log. 365 =2.5622929 
 
 Hence, log. (.06 -^ 365) =4.2158584 
 
 4.2158584 is, we find, the logarithm of .0001643835; and, 
 therefore, the value found thus far is : 
 
 y=(l + .0001643835) ^^^ — 1 
 or, ; = 1.0001643835'«' — 1 
 
 The logarithm of 1.0001643835 is .00007138 ; and 365 times 
 this latter figure is .02605370, which we find to be the loga- 
 rithm of 1.061826. The value for the effective rate then 
 becomes : 
 
 y = 1.061826 — 1 
 or, y= .061826, or 6.1826% 
 
CHAPTER IX 
 
 BONDS AND THE PROPER BASIS OF BOND 
 ACCOUNTS 
 
 § 96. Provisions of Bonds 
 
 The most common forms of interest-bearing securities 
 are bonds. Every bond contains a complex promise to pay : 
 
 (1) A certain sum of money at a stipulated future time, 
 
 this sum being known as the principal, or par. 
 
 (2) Certain smaller sums, proportionate to the principal, 
 
 and payable at various earlier times than the 
 principal. 
 
 These smaller sums are usually known as the interest 
 payments, but, as they do not necessarily correspond to the 
 true rate of interest, it will be better to speak of them as the 
 coupons. 
 
 Bonds also contain provisions as to the time, place, and 
 manner of these payments, and usually refer, also, to the 
 mortgage, if any, made to insure their fulfillment, and to the 
 law, if any, authorizing the issue. 
 
 §97. Interest on Bonds 
 
 The rate of interest named in a bond is usually an integer 
 per cent, or midway between two integers: as, 2%, 2%%, 
 3%, 31/2%, 4%, 41/2%, 5%, 6%, 7%, etc. Occasionally 
 such odd rates occur as 3%%, 3.60%, 3.65%, 33/4%, but 
 these are unusual and inconvenient. Most bonds provide for 
 semi-annual payments of interest ; a considerable number of 
 
 75 
 
^6 THE MATHEMATICS OF INVESTMENT 
 
 issues, however, pay interest quarterly, and a very few 
 annually. With- most bonds, the interest is payable on the 
 first day of the month. In the case of a very few bonds 
 the interest falls due on- the 15th or on the last day of the 
 month. In some respects it would be better if bond interest 
 were payable on the last day of a calendar month, instead 
 of on the first day of the succeeding month, since the entire 
 transaction (including* the payment of cash for the accrued 
 interest) would thus be brought inside of a calendar period. 
 The item of "Interest Accrued" on monthly balance sheets 
 would in this manner frequently be eliminated, or at least 
 substantially reduced. 
 
 § 98. How Bonds Are Designated 
 
 Bonds are usually designated according to the obligor, 
 the rate of interest, the date of maturity, and sometimes the 
 initials of the months when interest is payable. Thus, "Man- 
 hattan 4's of 1990, J J" indicates the bonds of the Manhat- 
 tan Railway Company, bearing 4% interest per annum, the 
 principal being due in 1990, and the interest coupons being 
 payable semi-annually in January and July. 
 
 § gg. Relation of Cost to Net Income 
 
 Bonds are seldom bought or sold at their exact par 
 value, and this fact has an effect on the rate of net income 
 derived from the original investment. If the amount in- 
 vested is greater than the par value, the difference is known 
 as the premium. This premium is not repaid at maturity, 
 as is the par value or principal of the bond, and hence must 
 be provided for out of the various interest payments. Thus, 
 a. bond purchased above par produces a lower rate of in- 
 come than the rate of interest represented by the coupons. 
 Conversely, if the purchase is below par, the investor will, 
 at maturity, receive not only the amount of his original in- 
 
BONDS AND BOND ACCOUNTS 77 
 
 vestment, but also the difference between this amount and 
 the par value of the bond. This difference, technically 
 known as the discount, has the effect of making the rate of 
 income higher than the rate of interest shown by the 
 coupons. 
 
 § 100. Coupon and Effective Rate of Interest on Bonds 
 
 The following are some of the expressions used to de- 
 note an investment made above par : "6% bond to net 5%"; 
 "6% bond on 5% basis"; "6% bond yielding 5%"; "6% 
 bond paying 5%"; etc. In the cases of bonds bought below 
 par, the income rate would be larger than the coupon rate, 
 as, for example, "3% bond to net 4%," etc. In all of the 
 above instances, the percentage immediately preceding the 
 word "bond" signifies the coupon rate of interest, while the 
 other percentage signifies the true or effective rate of 
 interest. 
 
 § loi. Present Worth of Bonds 
 
 It will be seen, therefore, that the sale of a bond involves 
 the transfer of the right to receive, at the stipulated times, 
 both the principal and the periodical amounts of interest. 
 None of these various sums is ever worth its face value, or 
 par, until the arrival of its stipulated date of payment. The 
 principal is never worth its face value until its maturity, 
 and the coupons are never worth their face values until 
 their respective maturities. Yet, while both principal and 
 coupons are always at a discount, except at their respective 
 dates of maturity, the aggregate value or present worth of 
 the principal and coupons at any one time prior to maturity 
 is frequently more than the par value of the principal alone 
 (as in the case of a bond bought at a premium) ; and it is 
 this aggregate present worth of both principal and coupons 
 which is always the question at issue in connection with the 
 purchases and sales of bonds. 
 
y8 THE MATHEMATICS OF INVESTMENT 
 
 § 102. Considerations in the Purchase of Bonds 
 
 In fixing the price which he is wiUing to pay, the pur- 
 chaser is guided by several considerations, among them the 
 following : 
 
 (1) The amount of the principal. 
 
 (2) The date of maturity of the principal. 
 
 (3) The amount of each coupon. 
 
 (4) The number of coupons. 
 
 (5) The dates of maturity of the various coupons. 
 
 (6) The rate of interest which can be earned upon 
 
 securities of a similar grade. 
 
 This last point also involves a determination of the de- 
 gree of probability that the principal and the various coupons 
 will be promptly paid at their dates of maturity; or, in 
 other words, consideration must be given to the financial 
 reputation and integrity of the obligor. 
 
 § 103. Present Worth and Earning Capacity of Bonds 
 
 In effect, the purchaser of a bond discounts, at a certain 
 fixed rate, the principal and each coupon at compound inter- 
 est, for the periods which they respectively have to run, and 
 the sum of these partial present worths is the value o'f the 
 bond. If he can buy at a price below this value, he will re- 
 ceive a higher rate of Interest than he anticipated. If he has 
 to pay more than this value, his rate of Interest will be lower. 
 As he cashes each coupon, he receives what he paid for it, 
 plus compound interest at the uniform rate; thenceforward 
 he earns interest on a diminished Investment as far as cou- 
 pons are concerned, but on an increased investment as to 
 principal. If the par value of his coupons Is less than the 
 total interest earned during the period, there Is an Increase 
 in the total Investment; if such par value is greater, then 
 there Is a surplus which operates to reduce the investment or 
 to amortize the premium. 
 
BONDS AND BOND ACCOUNTS 79 
 
 § 104. Cost and Par of Bonds 
 
 There are, therefore, two fixed points in the history of a 
 bond : the original cost, or money invested, and the principal, 
 or par — the money to be received at maturity. Between 
 these two points there is a gradual change : if bought below 
 par, the bond must rise to par; if bought above par, it must 
 sink to par. This gradual change is the resultant effect of 
 two opposing forces, the interest earned tending to increase 
 the investment value, while the payment of coupons reduces 
 the investment value. At any intermediate moment between 
 these two points there is an investment value which can be 
 calculated, and which is just as true as the original cost and 
 the par. In fact, these latter are merely special cases of in- 
 vestment value ; the investment value at the date of purchase 
 is cost, and at the date of maturity it is par. 
 
 § 105. Intermediate Value of Bonds 
 
 The gradual change in investment value of bonds be- 
 tween purchase and maturity is ignored by some investors, 
 who, during the whole period, use either the original cost or 
 the par value. In the former case they suppose that the in- 
 vestment value remains at its original figure until the very 
 day of maturity, and is then instantly changed to par, either 
 by a loss of all of the premium or by a sudden gain of all of 
 the discount. Those who use par as the investment value 
 also assume that there is this sudden change of value, the 
 difference being that the change occurred at the instant of 
 purchase instead of at maturity. These methods of treat- 
 ment are manifestly fictitious and unreal, and are only re- 
 sorted to on account of the labor involved in computing in- 
 termediate values. Experience would tell us, if theory did 
 not, that there is no such violent change. The cost and the 
 par value, while entirely correct at the beginning and at the 
 end, respectively, of the period of ownership, are entirely 
 incorrect during the interim. 
 
8o THE MATHEMATICS OF INVESTMENT 
 
 § 1 06. True Investment Basis for Bonds 
 
 The true standard of investment value for bonds is the 
 present worth, at compound interest, of all recipiends, or 
 sums of cash to be received, whether such sums be called 
 coupons or principal. Neither the original cost of a bond 
 nor its ultimate par is a proper permanent investment basis. 
 The bond should enter into the accounts at cost, which is a 
 fact, and should go out of the accounts at par, which is an- 
 other fact. During the interim, the change from cost to par 
 should take place gradually by the processes of amortization 
 or accumulation, at the rate of the true interest on the 
 original investment. 
 
 § 107. Various Bond Values 
 
 There are thus three values in the life of a bond which 
 resemble three tenses in grammar : The past tense represents 
 the cost, that is, the amount originally paid ; the future tense 
 represents the par, which is the amount ultimately to be re- 
 ceived; while the present tense represents the investment 
 value, intermediate between the values of the past and future, 
 except in the special case of a bond bought at par. 
 
 There is also a fourth value of a bond, that is, the 
 amount which might be obtained on sale at the present time. 
 This is the market value, and is a matter of judgment, 
 opinion, and inference. Although the market value of a 
 bond has great utility in some respects, it has no place, 
 strictly speaking, in accounts kept with regard to invest- 
 ments. It is not an act or a fact of the business; it is a 
 statement of what might be done. The market value con- 
 templates a possibility, or a probability — ^but never an 
 actuality, in so far as the accounts are concerned, unless a 
 sale is actually consummated. If an investor has had an 
 opportunity to make a sale of a bond, but has allowed it to 
 pass by, the mere fact that he has been offered such an op- 
 
BONDS AND BOND ACCOUNTS 8l 
 
 portunity to sell has not the slightest effect on his financial 
 status. 
 
 § 1 08. Investment Value the True Accounting Basis 
 
 Unless accounts with respect to bonds and similar securi- 
 ties are kept on the investment-value basis, an investor is 
 unable to tell whether a contemplated selling price will result 
 in a loss or a gain. If the books are kept on* the basis of 
 par, every sale above par will appear as a gain, even though 
 it may be a losing bargain; while a comparison with the 
 Driginal cost will be equally delusive and unsatisfactory. 
 
CHAPTER X 
 
 VALUATION OF BONDS 
 
 § 109. Cash Rate and Income Rate of Bonds 
 
 With respect to all bonds bought above or below par, 
 there are always two rates of interest involved: first, a 
 nominal or cash rate, which is a certain percentage of par, 
 and which is indicated by the coupons ; and second, an effec- 
 tive or income rate, which is a certain percentage of the 
 amount originally invested and remaining invested. For the 
 sake of greater clearness, we shall use the terms cash rate 
 and income rate, since they are more readily understood 
 than the terms nominal and effective. The symbols c and 
 i will respectively designate the cash rate and the income 
 rate. 1 + i is the ratio of increase as heretofore. The 
 symbol 1 + c will not be required, since c is not an accumula- 
 tive rate, but merely an annuity purchased with the bond, 
 the number of periods of the annuity being the same as the 
 number of coupons attached to the bond. The difference of 
 rates is c — i, or i — c. 
 
 §110. Elements of a Bond 
 
 In a bond purchased above or below par, we have, there- 
 fore, the following elements : the par, or principal, payable 
 after n periods ; an annuity of c per cent of par for n periods ; 
 and a ratio of increase, 1 + i. With these elements given, 
 there are two distinct methods for finding the value of the 
 entire security, and these must give the same result. 
 
 82 
 
VALUATION OF BONDS 83 
 
 §111. Valuation of Bonds — First Method 
 
 As an illustration of this method, let us take the case 
 of a 7% bond, having 25 years (50 periods) to run, interest 
 payable semi-annually, the par being $1,000. Suppose that 
 it is required to compute the value of the bond at the be- 
 ginning of its first interest period. This present value is 
 composed of two parts : (a) the present worth of $1,000 
 due 50 periods hence; and (b) the present worth of an an- 
 nuity of $35 for 50 terms. We cannot ascertain the value 
 of these two parts until we know the income rate current 
 upon securities of a similar grade. Let us assume that this 
 income rate is 3% per period, or what is usually called a 
 6% basis. The ratio of increase is thus 1.03 per period. 
 
 § 112. (a) Finding Present Worth of Principal 
 
 The first part of the solution is to find the present worth 
 of $1,000 due in 50 periods, at 3% per period. In § 52, 
 we have found the present worth of $1.00, under the same 
 conditions, to be $.2281071 ; hence the similar present worth 
 of $1,000 is $228.1071. This result, it will be noticed, has 
 not the slightest reference to the 7% rate of the bond. For 
 the purposes of the first part of the solution, the cash or 
 coupon rate is absolutely immaterial; the bond might be 
 equally well a 10% bond or a 0% bond, in the latter case 
 bearing no coupons at all. 
 
 §113. (b) Present Worth of Coupons 
 
 We next have to find the present value of an annuity of 
 $35 for 50 terms at 3%. In § 73, we found the present value 
 of a similar annuity of $1.00 to be $25.72976 +. An 
 annuity of $35, therefore, has a present value of $900.5417. 
 Hence, we have the following : 
 
84 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Present worth of the par $228.1071 
 
 Present worth of the coupons 900.5417 
 
 Present worth of the entire bond $1,128.6488 
 
 The ordinary tables, which give the values of a $100 bond 
 only, read $112.86, which is the same as the above, rounded 
 off. The above computation gives a result which is correct 
 to the nearest cent on $100,000, viz. : $112,864.88. 
 
 §114. Schedule of Evaluation 
 
 In order to present the subject still more clearly, in a 
 schedule form, let it be required to find the value, as at Jan- 
 uary 1, 1913, of a 7% bond for $1,000, interest payable 
 semi-annually, due at January 1, 1915, the income rate being 
 3% per period. In § 30, we have found that the present 
 worth of $1.00. for 1, 2, 3, and 4 periods is $.970874, 
 $.942596, $.915142, and $.888487, respectively. The re- 
 spective present worths of $35.00 are, therefore, $33.980590, 
 $32.990860, $32.029970, and $31.097045. The following 
 schedule may then be formed : 
 
 
 
 Periods from 
 
 Present 
 
 Items to be 
 
 Dates of 
 
 Jan. 1, 1013, 
 
 Worth 
 
 Evaluated 
 
 Maturity- 
 
 to Dates of 
 
 at Jan. 1, 
 
 
 
 Maturity 
 
 1913 
 
 Coupon, $35 
 35 
 35 
 35 
 
 July 
 January 
 
 July 
 
 January 
 
 1, 1913 
 1, 1914 
 1, 1914 
 1, 1915 
 
 1 
 
 2 
 3 
 4 
 
 $33.980590 
 32.990860 
 32.029970 
 31.097045 
 
 Total . 
 
 . . $130.098465' 
 
 Par, $1,000 
 
 January 
 rotal 
 
 1, 1915 
 
 4 
 
 888.487 
 
 Grand 1 
 
 .$1,018.585465 
 
VALUATION OF BONDS 85 
 
 The total present value of the four coupons 
 ($130.098465) could have been found by one operation, as 
 was done in the preceding section, and this is the usual 
 method of finding the present worth of an annuity. The 
 foregoing schedule, however, sets forth the details clearly, 
 although it is not a practicable method of evaluation when 
 the number of coupons is large. 
 
 § 115. Valuation of Bonds — Second Method 
 
 In illustration of this method, we shall assume the same 
 facts as presented in § 111. Each semi-annual payment of 
 $35 may be considered as made up of two parts : $30 and 
 $5. The $30 is the income on the $1,000 par value at the 
 assumed semi-annual income rate of 3%. We may disre- 
 gard this, and consider only the $5, which is a surplus over 
 and above the income rate, and, in fact, is an annuity which 
 must be paid for and which is represented by the premium 
 paid on the bond. Having devoted $30 to the payment of 
 our expected income-rate on par, we have a remainder of 
 $5, the difference in rates per period ; this annuity of $5, in 
 excess of the income rate, is a semi-annual benefit the value 
 of which is to be ascertained. 
 
 We have already found the present value of an annuity 
 of $1.00 for 50 terms at 3% to be $25.72976. The present 
 value of a similar annuity of $5.00 would therefore be 
 $128.6488, which is the premium and which agrees with 
 the result found in § 113. The method is not only quicker 
 than the first method presented, but also often gives one 
 more place of decimals. 
 
 §116. Evaluation when Cash Rate Is Less than Income 
 Rate 
 
 In the case of a bond sold below par, and where, ac- 
 cordingfly, the cash rate is less than the income rate, the 
 
86 
 
 THE MATHEMATICS OF INVESTMENT 
 
 same procedure is followed for finding the present worth 
 of an annuity of the difference in rates. In the above illus- 
 tration, if the bond had a cash rate of 5% instead oi 7%, 
 the annuity to be evaluated would still be $5 (that is, $30 
 less $25). In this case, however, the value of the annuity 
 ($128.6488) would have to be subtracted from the par, 
 giving $871.3512 as the value of a 5% bond, due in 25 
 years and having an income rate of 3% per period. This 
 would be commonly known as a 6% basis, although the 
 effective annual income is 6.09%, as pointed out in § 91. 
 
 §117. Second Method by Schedule 
 
 As a further illustration of the second method of 
 evaluation, let us take the case of the bond described in 
 § 114. Under the second method the schedule would be : 
 
 Differences 
 
 Between Cash and 
 
 Income Rates 
 
 (c-i) 
 
 Dates of 
 Maturity 
 
 Periods from 
 
 Jan. 1, 1913, 
 
 to Dates of 
 
 Maturity 
 
 Present 
 Worth 
 at Jan. 1, 
 1913 • 
 
 $5 
 5 
 5 
 5 
 
 July 1, 1913 
 January 1, 1914 
 July 1, 1914 
 January 1, 1915 
 
 al 
 
 1 
 
 2 
 3 
 4 
 
 $4.854370 
 4.712980 
 4.575710 
 4.442435 
 
 Tot 
 
 . .$18.585495 
 
 
 
 
 
 The premium above found disagrees slightly with that 
 shown in § 114, since in the latter case there is a loss of 
 three decimal places in finding the present worth of the 
 $1,000 par value. In examining the above schedule, it must 
 be borne in mind that the total can be ascertained by a 
 single operation, and that the details are here presented only 
 for the sake of additional clearness. 
 
VALUATION OF BONDS 87 
 
 § 118. Rule for Second Method of Evaluation 
 
 . Since the second method is superior to the first, it will 
 hereafter be considered as the standard; and we give ac- 
 cordingly the following rule: The premium (or discount) 
 on a bond bought above (or below) par is the present worth, 
 at the income rate, of an annuity equal to the difference be- 
 tween the cash and income rates for the life of the bond. 
 
 § 119. Principles of Investment 
 
 We have found the value of a 7% bond for $1,000, 
 paying 6% (semi-annually), due in 25 years, to be 
 $1,128.65 to the nearest cent. This is the amount which 
 must be invested if the 6% income is to be secured. At the 
 end of the first half-year, the holder of the bond receives, as 
 income, 3% interest on the $1,128.65 originally invested, 
 which is $33.86. But he actually collects $35.00, and after 
 deducting $33.86 as revenue, there remains $1.14, which 
 must be applied in amortizing the premium. This will 
 leave the value of the bond at the end of the first half-year, 
 at the same income rate, $1,127.51. If our operations have 
 been correct, the value of a 7% bond to net 6% (payable 
 semi-annually), having 24% years or 49 periods to run, 
 will be $1,127.51. To test this, and to exemplify the method 
 through the use of logarithms, the entire operation is pre- 
 sented in the following section. 
 
 § 120. Solution by Logarithms 
 
 The logarithm of 1 is zero 
 
 The logarithm of 1.03 is .01283722 
 
 The logarithm of 1.03*' is therefore _.6290238 
 
 The logarithm of (1 ^ 1.03"") is therefore. . 1.3709762 
 
 We find that the logarithm of .23495 is 1.3709754 
 
 Remainder 8 
 
 This gives the additional decimal figures 02. 
 
88 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Hence, $.2349502 is the present value of $1.00 at 3% 
 per period for 49 periods. The compound discount is there- 
 fore $.7650498, and this divided by the single rate of in- 
 terest, 3%, gives the result $25.50166, which is the present 
 value of an annuity of $1.00 per period. The difference be- 
 tween the cash and income rates is $5, i.e., $35 — $30. 
 Therefore, the present value of a $5 annuity for 49 periods 
 at 3% would be $127,508, or, rounded off, $127.51, which 
 is the premium desired. Adding this to the par, we have 
 $1,127.51, which agrees with the result obtained in § 119. 
 
 § 121. Amortization Schedule 
 
 When bonds are purchased for investment purposes, a 
 Schedule of Amortization should be constructed, showing 
 the gradual extinction of the premium by the application of 
 the surplus interest. The form shown below is recom- 
 mended for this purpose, although it is merely suggestive 
 and not complete. The calculations should be continued to 
 the date of maturity, and at intervals corrected in the last 
 figure by a fresh logarithmic computation. 
 
 Schedule of Amortization 
 
 7% Bond of the. , , payable January 1, 
 
 1939. Net 6%. J J. 
 
 Date 
 
 Total 
 Interest 
 
 7% 
 
 Net 
 Income 
 
 Amortiza- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, Jan. 1 
 
 Cost 
 
 
 
 ..$1 128 65 
 
 $1,000.00 
 
 Julyl 
 
 1915, Jan. 1 
 
 Julyl 
 
 $35.00 
 35.00 
 35.00 
 
 $33.86 
 33.83 
 33.79 
 
 $1.14 
 1.17 
 1.21 
 
 1,127.51 
 1,126.34 
 1,125.13 
 
 Strictly speaking, the net income rate is not 6% per 
 annum, but 3% for each semi-annual period, or an effective 
 
VALUATION OF BONDS 
 
 89 
 
 annual rate of 6.09%. The column headed "Total Interest" 
 could be changed to "Cash Receipts," and the term "Book 
 Value" might also be called "Investment Value." 
 
 § 122. Use of Schedules in Accountancy 
 
 The foregoing schedule is the source of the entry which 
 should be made each half-year for "writing off" the premium 
 or "writing up" the discount, in order that at maturity the 
 bond may stand exactly at par. Two other schedules are 
 set forth below, in which the semi-annual steps in the chang- 
 ing value of the bond are shown in detail from the date of 
 purchase until maturity, one schedule being for a bond 
 bought above par, and the other for a bond bought below 
 par. Since the formation of schedules is the basis of the 
 accountancy of amortized securities, we shall present the 
 same material in various forms, and shall attach to the 
 schedules the letters (A), (B), etc., for the purposes of 
 ready reference. 
 
 Schedule (A) — ^Amortization 
 
 5% Bond of the ,. ., payable May 1, 
 
 1919. M N. 
 
 Date 
 
 Total 
 
 Interest 
 
 5< 
 
 Net 
 Income 
 
 Amortiza- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, May 1 
 Nov. 1 
 
 1915, May 1 
 Nov. 1 
 
 1916, May 1 
 Nov. 1 
 
 1917, May 1 
 Nov. 1 
 
 1918, May 1 
 Nov. 1 
 
 1919, May 1 
 
 Cost 
 
 
 
 $104,491.29 
 104,081.12 
 103,662.74 
 103,236.00 
 102,800.72 
 102,356.73 
 101,903.86 
 101,441.94 
 100,970.78 
 100,490.20 
 100,000.00 
 
 $100,000.00 
 
 $ 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 
 $ 2,089.83 
 2,081.62 
 2,073.26 
 2,064.72 
 2,056.01 
 2,047.13 
 2,038.08 
 2,028.84 
 2,019.42 
 2,009.80 
 
 $ 410.17 
 418.38 
 426.74 
 435.28 
 443.99 
 452.87 
 461.92 
 471.16 
 480.58 
 490.20 
 
 
 $25,000.00 
 
 $20,508.71 
 
 $4,491.29 
 
 
90 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Schedule (B) — Accumulation 
 
 3% Bond of the , payable May 1, 
 
 1919. M N. 
 
 Date 
 
 Total 
 Interest 
 
 3^ 
 
 Net 
 
 Income 
 
 4^ 
 
 Accumula- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, May 1 
 
 
 
 
 $95,508.71 
 
 $100,000.00 
 
 Nov. 1 
 
 $ 1,500.00 
 
 $ 1,910.17 
 
 $ 410.17 
 
 95,918.88 
 
 
 1915, May 1 
 
 1,500.00 
 
 1,918.38 
 
 418.38 
 
 96,337.26 
 
 
 Nov. 1 
 
 1,500.00 
 
 1,926.74 
 
 426.74 
 
 96,764.00 
 
 
 1916, May 1 
 
 1,500.00 
 
 1,935.28 
 
 435.28 
 
 97,199.28 
 
 
 Nov. 1 
 
 1,500.00 
 
 1,943.99 
 
 443.99 
 
 97,643.27 
 
 
 1917, May 1 
 
 1,500.00 
 
 1,952.87 
 
 452.87 
 
 98,096.14 
 
 
 Nov. 1 
 
 1,500.00 
 
 1,961.92 
 
 461.92 
 
 98,558.06 
 
 
 1918, May 1 
 
 1,500.00' 
 
 1,971.16 
 
 471.16 
 
 99,029.22 
 
 
 Nov. 1 
 
 1,500.00 
 
 1,980.58 
 
 480.58 
 
 99,509.80 
 
 
 1919, May 1 
 
 1,500.00 
 
 1,990.20 
 
 490.20 
 
 100,000.00 
 
 
 
 $15,000.00 
 
 $19,491.29 
 
 $4,491.29 
 
 
 § 123. Book Values in Schedules 
 
 In the foregoing two schedules, (A) and (B), it will 
 be observed that at any given date the book value in 
 Schedule (A) is always exactly as much above par as the 
 book value in Schedule (B) is below par. During any 
 given period, the "amortization" and the "accumulation" 
 are exactly the same in both, being deducted in Schedule 
 (A) and added in Schedule (B). 
 
 § 124. Checks on Accuracy of Schedules 
 
 There are three internal checks which are of value in 
 verifying the accuracy of the schedules. For example, in 
 Schedule (B), the following facts may be observed: 
 
 (1) The total interest plus the total accumulation equals 
 the total net income. 
 
 (2) The total accumulation equals the par less the book 
 value; or, in other words, it equals the inaugural discount. 
 
VALUATION OF BONDS 
 
 91 
 
 (3) Each item of accumulation equals the preceding one 
 multiplied by the semi-annual ratio of increase 1.02, the 
 semi-annual net income being 2%. That is : 
 
 $461.92X1.02 = $471.16 
 
 $471.16 X 1.02 = $480.68 
 
 etc. 
 
 In some instances in these computations, there will be an 
 apparent error of one cent, which is accounted for by the 
 fact that the number of decimal places is not carried out 
 sufficiently far. 
 
 § 125. Tables Derivable from Bond Values 
 
 The figures in the column headed "Book Value" might 
 be taken from tables of bond values published in book form. 
 If Sprague's Eight-Place Bond Tables were used, and if 
 the column "Book Value" were copied directly from the 
 tables, the other columns could be derived by the processes 
 of addition or subtraction. The result arrived at by this 
 method would be exactly the same as the results shown in 
 Schedules (A) and (B). The successive amounts of 
 amortization or accumulation would be found by finding 
 the differences between successive book values; while the 
 net income for any period would be found by either adding 
 the accumulation to the total interest, or by deducting the 
 amortization from the total interest. 
 
 § 126. Methods of Handling Interest 
 
 It will be observed that in Schedules (A) and (B), the 
 entire interest is accounted for, both in the case of the 
 interest on par plus premium, and also in the case of the in- 
 terest on par minus discount. We may easily construct the 
 schedules so as to eliminate the par and the interest thereon 
 
92 
 
 THE MATHEMATICS OF INVESTMENT 
 
 at the rate i. In this manner we would have to deal only 
 with the surplus interest or the deficient interest, according 
 to the theory explained in § 115. Since this method may be 
 preferable for some forms of accounts, a new schedule is 
 presented below, based on the same facts as those shown in 
 Schedule (A) : 
 
 Schedule (C) — Amortization; Premium Only 
 
 Date 
 
 Surplus 
 Interest 
 on Par 
 
 1% 
 
 Interest 
 
 on 
 Premium 
 
 4^ 
 
 Amortiza- 
 tion 
 
 Premium 
 
 1914, May 
 
 
 
 
 
 $4,491.29 
 
 Nov. 
 
 
 $ 500.00 
 
 $ 89.83 
 
 $ 410.17 
 
 4,081.12 
 
 1915, May 
 
 
 500.00 
 
 81.62 
 
 418.38 
 
 3,662.74 
 
 Nov. 
 
 
 500.00 
 
 73.26 
 
 426.74 
 
 3,236.00 
 
 1916, May 
 
 
 500.00 
 
 64.72 
 
 435.28 
 
 2,800.72 
 
 Nov. 
 
 
 500.00 
 
 56.01 
 
 443.99 
 
 2,356.73 
 
 1917, May 
 
 
 500.00 
 
 47.13 
 
 452.87 
 
 1,903.86 
 
 Nov. 
 
 
 500.00 
 
 38.08 
 
 461.92 
 
 1,441.94 
 
 1918, May 
 
 
 500.00 
 
 28.84 
 
 471.16 
 
 970.78 
 
 Nov. 
 
 
 500.00 
 
 19.42 
 
 480.58 
 
 490.20 
 
 1919, May 
 
 
 500.00 
 
 9.80 
 
 490.20 
 
 0. 
 
 
 $5,000.00 
 
 $508.71 
 
 $4,491.29 
 
 
 § 127. Schedule of Bond Values 
 
 Another way of setting forth the value of bonds at the 
 successive interest dates is shown in the following table, 
 which indicates clearly the steps taken in computing the 
 value. This table, however, is not nearly so compact as the 
 preceding ones, and for this reason is not recommended, for 
 most purposes. We will take as an illustration Schedule 
 (A), shown in §122. 
 
VALUATION OF BONDS 93 
 
 Value of bond at May 1, 1914 (cost) $104,491.29 
 
 Amortization for ensuing 6 months : 
 Nominal interest at 2%% on 
 
 $100,000.00 $2,500.00 
 
 Effective interest at 2% on 
 
 $104,491.29 '. 2,089 .83 
 
 Difference, being the amor- 
 tization to be subtracted 
 from the investment value 410.17 
 
 Value of bond at November 1, 1914 $104,081.12 
 
 Amortization for ensuing 6 months : 
 Nominal interest at 2^/2% on 
 
 $100,000.00 $2,500.00 
 
 Effective interest at 2% on 
 
 $104,081.12 2,081.62 
 
 Difference, being the amor- 
 tization to be subtracted 
 from the investment value , 418.38 
 
 Value of bond at May 1,1915 $103,662.Y4 
 
 etc., etc. 
 A slight variation of the above form is to put all of the 
 figures of the schedule in one column, as follows : 
 
 Value, May 1, 1914 $104,491.29 
 
 Plus effective interest 2,089.83 
 
 $106,581.12 
 Minus amortization 2,500.00 
 
 Value, November 1, 1914 $104,081.12 
 
 Plus effective interest 2,081.62 
 
 $106,162.74 
 
 Minus amortization 2,500.00 
 
 Value, May 1, 1915 $103,662.74 
 
 etc., etc. 
 
94 
 
 THE MATHEMATICS OF INVESTMENT 
 
 By using red ink for the subtrahends (which are indi- 
 cated by italic figures), the addition and subtraction can be 
 performed at one operation, viz. : 
 
 $104,491.29 
 
 2,089.83 
 2,500.00 
 
 $104,081.12 
 2,081.62 
 2,500.00 
 
 $103,662.74 
 2,073.26 
 2,500.00 
 
 $103,236.00 
 etc., etc. 
 
 It will be noticed that the computation of the interest 
 may be done without using any other paper. Even with a 
 fractional rate, such as 2.7% per annum, or 1.35% per 
 period, the 1%, the .3%, and the .05% may be successively 
 written down direct without further computation. For 
 example : 
 
 Assumed inaugural value $120,039.00 
 
 1,200.39 
 360.117 
 60.019 
 2,500.00 
 
 Value at end of 6 months ,. . .$119,159,526 
 
 1,191.595 
 357.479 
 59.580 
 2,500.00 
 
 Value at end of 1 year $118,268,180 
 
 etc., etc. 
 
CHAPTER XI 
 
 VALUATION OF BONDS (Concluded) 
 
 § 128. Bond Purchases at Intermediate Dates 
 
 It has hitherto been assumed that the purchase of the 
 bond took place exactly upon an interest date. In the vast 
 majority of purchases, however, the purchase date differs 
 from the interest date, and we will now consider cases of 
 this character. Let us suppose that the interest dates are 
 May 1 and November 1, whereas the purchase took place on 
 July 1, after one-third of the interest period had elapsed. 
 The business custom is to adjust the matter as follows : The 
 buyer pays to the seller the (simple) interest accrued for the 
 two months, acquiring thereby the full interest rights, which 
 will fall due on November 1, and the premium (or the dis- 
 count, as the case may be) is also considered as vanishing 
 by an equal portion each month, so that one-third of the half- 
 yearly amortization takes place by July 1. Taking as an 
 illustration the bond considered in Schedule (A) (§122), 
 the amortization from May 1, 1914, to November 1, 1914, 
 is $410.17; the amortization up to July 1 would therefore 
 be one-third of this amount, or $186.72. The book value at 
 July 1 is $104,491.29 minus $136.72, plus $833.33 (the 
 accrued interest for two months), giving a net figure of 
 $105,187.90. This last amount is called the nat price, that 
 is, it is the price including interest ; if the interest is not in- 
 cluded, the price is said to be at so many per cent and 
 interest. These are the two methods in most common use 
 for indicating the prices of bonds. The flat price as above 
 
 95 
 
C|6 THE MATHEMATICS OF INVESTMENT 
 
 computed might also have been obtained in the following 
 manner : 
 
 To the value on May 1, 1914 $104,491.29 
 
 add simple interest thereon for 2 months at 4%, 
 
 which is the effective income rate 696.61 
 
 giving the flat price at July 1, 1914 $105,187.90 
 
 § 129. Errors in Adjusting Bond Prices 
 
 This practice of adjusting the price of bonds at inter- 
 mediate dates by simple interest is conventionally correct, 
 but is scientifically inaccurate, and always works a slight 
 injustice to the buyer. The seller is having his interest 
 compounded at the end of two months instead of six months, 
 and receives a benefit therefrom at the expense of the buyer. 
 It will be readily seen that the buyer does not net the effec- 
 tive rate of 4% semi-annually on his investment of $105,- 
 187.90. In order to give both buyer and seller a return at 
 the effective rate of 2% semi-annually (or 4.04% annually), 
 with a bimonthly conversion for the seller and a four-month- 
 ly conversion for the buyer, the true price would be $105,- 
 183.31.* In practice, however, for any time under six 
 months, simple interest is generally used, to the slight dis- 
 advantage of the buyer, who may claim that the value at 
 November 1, ($104,081.12) + interest due ($2,500.00), 
 should have been discounted at 4%. This would give $106,- 
 581.12 -^- 1.01 >^, or $105,178.74. This latter figure is al- 
 most exactly as much too low ($4.57) as the $105,187.90 
 is too high ($4.59). 
 
 •This price is found by finding the cube root of 1.02, which is 1.00662271. 
 This last figure is the rate for a two-months period at the effective rate of 2% 
 semi-annually, or 4.04% annually. When the value at May 1 ($104,491.29) is 
 multiplied by this figure, the result is $105,183.31, which is the true price on an 
 effective income basis of 4.04% annually. 
 
VALUATION OF BONDS 
 
 97 
 
 § 130* Schedule of Periodic Evaluation 
 
 The schedule would therefore, in practice, read as 
 follows : 
 
 Schedule (D) — Periodic Valuation; Simple Interest 
 
 Date 
 
 Total 
 Interest 
 
 5^ 
 
 Net 
 Income 
 
 A% 
 
 Amortiza- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, July 1 
 Nov. 1 
 
 Cost 
 
 
 
 $104,354.57 
 104,081.12 
 
 $100,000.00 
 
 $ 1,666.67 
 
 $ 1,393.22 
 
 $ 273.45 
 
 
 1915, May 1 
 
 2,500.00 
 
 2,081.62 
 
 418.38 
 
 103,662.74 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,073.26 
 
 426.74 
 
 103,236.00 
 
 
 1916, May 1 
 
 2,500.00 
 
 2,064.72 
 
 435.28 
 
 102,800.72 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,056.01 
 
 443.99 
 
 102,356.73 
 
 
 1917, May 1 
 
 2,500.00 
 
 2,047.13 
 
 452.87 
 
 101,903.86 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,038.08 
 
 461.92 
 
 101,441.94 
 
 
 1918, May 1 
 
 2,500.00 
 
 2,028.84 
 
 471.16 
 
 100,970.78 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,019.42 
 
 480.58 
 
 100,490.20 
 
 
 1919, May 1 
 
 2,500.00 
 
 2,009.80 
 
 490.20 
 
 100,000.00 
 
 
 
 $24,166.67 
 
 $19,812.10 
 
 $4,354.57 
 
 
 § 131. Objection to Valuation on Interest Dates 
 
 The interest dates may not always be the most con- 
 venient dates for periodical valuation. In the case of an 
 investment consisting of several kinds of bonds, there would 
 generally be some interest coupons falling due in every 
 month of the year, and yet on a certain annual or semi- 
 annual date the entire holdings must be simultaneously 
 valued, irrespective of the varying interest dates. In cases 
 of this kind, it will therefore be convenient if the schedules 
 can be arranged in such a manner that, without recalculation, 
 every book value will be ready to place in the balance sheet. 
 Fortunately, this is easier than would be supposed. 
 
98 THE MATHEMATICS OF INVESTMENT 
 
 § 132. Interpolation Method of Periodic Valuation 
 
 As an illustration, we will again take the bond described 
 in § 130 ; but we will now assume that the investor closes 
 his books on the last days of June and December. We will 
 suppose that the purchase is made on August 1, 1914. Since 
 August 1 is midway between May 1 and November 1, the 
 price must be adjusted as shown in § 128. The price at 
 August 1 would therefore be midway between $104,491.29 
 and $104,081.12 — namely, $104,286.20 — plus, of course, 
 the accrued interest ($1,250.00), this being the customary, 
 not the theoretical, method. The value at November 1 need 
 not enter into the schedule, but we must compute the De- 
 cember 31 value in the same manner as we found the July 1 
 value in § 128. One-third of the difference between $104,- 
 081.12 and $103,662.74, or $418.38, is $139.46; $104,- 
 081.12 — $139.46 = $103,941.66. Our schedule so far, 
 the headings being the same as in § 130, reads : 
 
 1914, Aug. 1 Cost $104,286.20 $100,000.00 
 
 Dec. 31 $2,083.33 $1,738.79 $344.54 103.941.66 
 
 Proceeding in the same way to find the value on June 30, 
 
 1915, from those on May 1 and November 1, we get $103,- 
 520.49. To these values at dates when interest does not 
 fall due, there must be added the accrued interest to find the 
 total values. This method of finding the value of bonds be- 
 tween interest dates is called interpolation. 
 
 § 133. Multiplication Method of Valuation 
 
 There is another method of finding the intermediate 
 values, however, which might be called the multiplication 
 method. Having found the value at December 31 to be 
 $103,941.66, the interest for six months thereon at 4% is 
 $2,078.83, which, subtracted from the coupon interest 
 
VALUATION OF BONDS 99 
 
 ($2,500.00), gives as the amortization $421.17. This latter 
 amount, written off from $103,941.66, gives $103,520.49 as 
 the value at June 30, which is precisely the same result as 
 was obtained by interpolation between May 1 and November 
 1 in § 132. In practice, the method of multiplication will 
 be found more convenient than the method of interpolation. 
 Having once adjusted the value at one of the balancing 
 periods, we can derive all of the values at the remaining 
 balancing periods by finding the net income, subtracting it 
 from the cash interest and reducing the premium by the 
 difference, completely ignoring the values on interest days 
 (M N). 
 
 § 134. Computation of Net Income for Partial Period 
 
 No difficulty arises until we reach the broken period, 
 January 1 to May 1, 1919. Here the computation of the 
 net income is peculiar; the par and the premium must be 
 treated separately. The net income on $100,000.00 is taken 
 at Yz of 2% for the ^ time, giving $1,333.33. The 
 premium. $326.80, however, must always be multiplied by 
 the full 2%, giving $6.54. Adding $1,333.33 and $6.54, 
 we have $1,339.87, which, used as heretofore, reduces the 
 principal to par. The reason for this peculiarity is that 
 $490.20 (the premium at November 1, 1918), and not 
 $326.80 (the premium at December 31, 1918), is the con- 
 ventional premium on which 4% is to be computed. Hence, 
 instead of taking $490.20 for ^ of a period, we take 
 $326.80 itself for a whole period; these two methods reach 
 the same result, since $490.20 is 3/2 of $326.80, and tv^^o- 
 thirds of three-halves is unity. In other words, Yz of 
 a dollar for a whole period is equivalent in value to the whole 
 of the dollar for ^ of a period. On the basis outlined, the 
 completed schedule would therefore be as follows : 
 
lOO THE MATHEMATICS OF INVESTMENT 
 
 Schedule (E) — Periodic Valuation by 
 Multiplication 
 
 Date 
 
 Total 
 Interest 
 
 Net 
 
 Income 
 
 4% 
 
 Amortiza- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, Aug. 1 
 
 Cost 
 
 
 
 $104,286.20 
 103,941.66 
 103,520.49 
 103,090.90 
 102,652.72 
 102,205.77 
 101,749.89 
 101,284.89 
 100,810.59 
 100,326.80 
 100,000.00 
 
 $100,000.00 
 
 Dec. 31 
 
 1915, Jun. 30 
 Dec. 31 
 
 1916, Jun. 30 
 Dec. 31 
 
 1917, Jun. 30 
 Dec. 31 
 
 1918, Jun. 30 
 Dec. 31 
 
 1919, May 1 
 
 $ 2,083.33 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 2,500.00 
 1,666.67 
 
 $23,750.00 
 
 $ 1,738.79 
 2,078.83 
 2,070.41 
 2,061.82 
 2,053.05 
 2,044.12 
 2,035.00 
 2,025.70 
 2,016.21 
 1,339.87 
 
 $ 344.54 
 421.17 
 429.59 
 438.18 
 446.95 
 455.88 
 465.00 
 474.30 
 483.79 
 326.80 
 
 
 $19,463.80 
 
 $4,286.20 
 
 
 § 135. Purchase Agreements 
 
 In all the foregoing examples it has been assumed that 
 the bond has been bought "on a basis," which means that 
 the buyer and seller have agreed upon the income rate which 
 the bonds shall pay, and that from this the price has been 
 adjusted. But in probably the majority of cases the bargain 
 is made "at a price," and then the income rate must be found. 
 This is a more difficult problem. 
 
 § 136. Approximation Method of Finding Income Rate* 
 
 The best method of ascertaining the basis, when the 
 price is given, is by trial and approximation — in fact, all 
 methods more or less depend upon that. The ordinary 
 tables will locate several figures of the rate, and one more 
 figure can safely be added by simple proportion. But it is 
 an important question to what degree of fineness we should 
 try to attain. It seems to be the consensus of opinion and 
 
 *For a new method of approximation, see Chapter XXIII. 
 
VALUATION OF BONDS lOl 
 
 practice that to carry the decimals to hundredths of one per 
 cent is far enough, although in some cases, by introducing 
 eighths and sixteenths, two-hundredths and four-hundredths 
 may be required. Sprague's Tables, by the use of auxiliary 
 figures, give values for each one-hundredth of one per cent. 
 
 § 137. Application of Method 
 
 Let us suppose that $100,000 of 5% bonds, 5 years to 
 run, M N, are offered at the round price of 104% on May 
 1, 1914. It is evident that this is nearly, but not quite, a 
 4% basis. Trying a 3.99% basis we find that the premium 
 is $4,537.39, which is further from the price than is $4,- 
 491.29, the 4% basis. Hence, 4% is the nearest basis within 
 1/100 of one per cent. In fact, by repeated trials, we find 
 that the rate is about .0399812 per annum. It is manifest 
 that such a ratio of increase as 1.0199906 would be very un- 
 wieldy and impracticable, and that such laborious exactness 
 would be intolerable. Yet here we have paid $104,500, and 
 the nearest admissible basis gives $104,491.29; what shall 
 be done with the odd $8.71 ? It must disappear before ma- 
 turity, and on a 4% basis it will be even larger at maturity 
 than now. Three ways of ridding ourselves of it may be 
 suggested. 
 
 § 138. First Method of Eliminating Residues 
 
 Add the residue $8.71 to the first amortization, thereby 
 reducing the value to an exact 4% basis at once. In Schedule 
 (A) — shown in § 122 — the first amortization would be 
 $418.88, instead of $410.17. This is at the income rate of 
 about 3.983% for the first half-year and thereafter at 4%. 
 For short bonds the result is fairly satisfactory. 
 
 § 139. Second Method of Eliminating Residues 
 
 Divide $8.71 into as many parts as there are periods. 
 
I02 
 
 THE MATHEMATICS OF INVESTMENT 
 
 This would give $.87 for each period, except the first, which 
 would be e$.88 on account of the odd cent. Set down the 4% 
 amortization in one column, the $.87 in the next, and the 
 adjusted figures in the third : 
 
 $410.17 
 
 $.88 
 
 $411.05 
 
 418.38 
 
 .87 
 
 419.25 
 
 426.74 
 
 .87 
 
 427.61 
 
 435.28 
 
 .87 
 
 436.15 
 
 443.99 
 
 .87 
 
 444.86 
 
 452.87 
 
 .87 
 
 453.74 
 
 461.92 
 
 .87 
 
 462.79 
 
 471.16 
 
 .87 
 
 472.03 
 
 480.58 
 
 .87 
 
 481.45 
 
 490.20 
 
 .87 
 
 491.07 
 
 The following will then be the schedule : 
 
 Schedule (F) — Elimination of Residues; 
 Second Method 
 
 Date 
 
 Total 
 Interest 
 
 Net 
 Income 
 4%i-) 
 
 Amortiza- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, May 1 
 
 
 
 
 $104,500.00 
 
 $100,000.00 
 
 Nov. 1 
 
 $ 2,500.00 
 
 $ 2,088.95 
 
 $ 411.05 
 
 104,088.95 
 
 
 1915, May 1 
 
 2,500.00 
 
 2,080.75 
 
 419.25 
 
 103,669.70 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,072.39 
 
 427.61 
 
 103,242.09 
 
 
 1916, May 1 
 
 2,500.00 
 
 2,063.85 
 
 436.15 
 
 102,805.94 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,055.14 
 
 444.86 
 
 102,361.08 
 
 
 1917, May 1 
 
 2,500.00 
 
 2,046.26 
 
 453.74 
 
 101,907.34 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,037.21 
 
 462.79 
 
 101,444.55 
 
 
 1918, May 1 
 
 2,500.00 
 
 2,027.97 
 
 472.03 
 
 100,972.52 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,018.55 
 
 481.45 
 
 100,491.07 
 
 
 1919, May 1 
 
 2,500.00 
 
 2,008.93 
 
 491.07 
 
 100,000.00 
 
 
 
 $25,000.00 
 
 $20,500.00 
 
 $4,500.00 
 
 
VALUATION OF BONDS 103 
 
 In this schedule the income rate varies from 3.997995^ 
 to 3.99822%; hence the approximation is sufficiently close 
 for any holdings, except large ones for long maturities. 
 
 § 140. Third Method of Eliminating Residues 
 
 For still greater accuracy, we may divide the $8.71 in 
 parts proportionate to the amortization. The amortization 
 on the 4% basis amounts to $4,491.29, and v^e have an 
 extra amount of $8.71 to exhaust. Dividing the latter by 
 the former, we have as the quotient .00194, which is the 
 portion to be added to each dollar of amortization. With 
 this we form a table for the 9 digits : 
 
 100194 
 200388 
 300582 
 400776 
 500970 
 601164 
 701358 
 801552 
 901746 
 
 From this table it is easy to adjust each item of amortiza- 
 tion, writing down, for example, to the nearest mill : 
 
 410.17 418.38 426.74 435.28 
 
 400.776 
 
 400.776 
 
 400.776 
 
 400.776 
 
 10.019 
 
 10.019 
 
 20.039 
 
 30.058 
 
 .100 
 
 8.016 
 
 6.012 
 
 5.010 
 
 .070 
 
 .301 
 .080 
 
 .701 
 .040 
 
 .200 
 
 410.97 
 
 .080 
 
 419.19 427.57 436.12 
 
I04 
 
 THE MATHEMATICS OF INVESTMENT 
 
 The respective amounts of amortization, in Schedule (G), 
 vary (at the most) but 8 cents from those shown in Schedule 
 (F). 
 
 Schedule (G) — Elimination of Residues 
 Third Method 
 
 Date 
 
 Total 
 Interest 
 
 5^ 
 
 Net 
 Income 
 4%(-) 
 
 Amortiza- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, May 1 
 
 
 
 
 $104,500.00 
 
 $100,000.00 
 
 Nov. 1 
 
 $ 2,500.00 
 
 $ 2,089.03 
 
 $ 410.97 
 
 104,089.03 
 
 
 1915, May 1 
 
 2,500.00 
 
 2,080.81 
 
 419.19 
 
 103,669.84 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,072.43 
 
 427.57 
 
 103,242.27 
 
 
 1916, May 1 
 
 2,500.00 
 
 2,063.88 
 
 436.12 
 
 102,806.15 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,055.15 
 
 444.85 
 
 102,361.30 
 
 
 1917, May 1 
 
 2,500.00 
 
 2,046.25 
 
 453.75 
 
 101,907.55 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,037.18 
 
 462.82 
 
 101,444.73 
 
 
 1918, May 1 
 
 2,500.00 
 
 2,027.93 
 
 472.07 
 
 100,972.66 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,018.49 
 
 481.51 
 
 100,491.15 
 
 
 1919, May 1 
 
 2,500.00 
 
 2,008.85 
 
 491.15 
 
 100,000.00 
 
 
 
 $25,000.00 
 
 $20,500.00 
 
 $4,500.00 
 
 
 § 141. Short Terminals 
 
 It sometimes happens (though infrequently) that the 
 principal of a bond is payable, not at an interest date, but 
 from one to five months later, making a short terminal 
 period. The following is a very simple method of obtain- 
 ing the present value in this case. It will not be necessary 
 to demonstrate it, but an example will test it. 
 
 Suppose the 5% bond, M N, yielding 4%, bought May 
 1, 1914, were payable October 1, instead of May 1, 1919, 
 that is, in 10 5/6 periods. The short period is 5/6. The 
 
VALUATION OF BONDS 105 
 
 short ratio (at 4%) will be 1.0166 J^. The short interest 
 (at 5%) will be .02083 J^. 
 
 We first ascertain the value for the ten full 
 
 periods, viz., for $1 1.0449129* 
 
 Add to this the short interest 0208333 
 
 1.0657462 
 and divide by the short ratio 1.0166667 
 
 To perform this division it will be easier to divide 3 times 
 the dividend by 3 times the divisor. 
 
 3.05 ) 3.1972386 ( Quotient 1.0482750 
 3.05 
 
 1472 
 1220 
 
 2523 
 2440 
 
 838 
 610 
 
 2286 
 2135 
 
 151 
 
 152 
 
 Multiplying down by the usual procedure, we have the 
 following schedule: 
 
 •See Schedule (A), § 122. 
 
 k 
 
I06 THE MATHEMATICS OF INVESTMENT 
 
 Schedule (H) — Short Terminals 
 
 Date 
 
 Total 
 Interest 
 
 5!< 
 
 Net 
 
 Income 
 
 4^ 
 
 Amortiza- 
 tion 
 
 Book 
 Value 
 
 Par 
 
 1914, May 1 
 
 
 
 
 $104,827.50 
 
 $100,000.00 
 
 Nov. 1 
 
 $ 2,500.00 
 
 $ 2,096.55 
 
 $ 403.45 
 
 104,424.05 
 
 
 1915, May 1 
 
 2,500.00 
 
 2,088.48 
 
 411.52 
 
 104,012.53 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,080.25 
 
 419.75 
 
 103,592.78 
 
 
 1916, May 1 
 
 2,500.00 
 
 2,071.86 
 
 428.14 
 
 103,164.64 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,063.29 
 
 436.71 
 
 102,727.93 
 
 
 1917, May 1 
 
 2,500.00 
 
 2,054.56 
 
 445.44 
 
 102,282.49 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,045.65 
 
 454.35 
 
 101,828.14 
 
 
 1918, May 1 
 
 2,500.00 
 
 2,036.56 
 
 463.44 
 
 101,364.70 
 
 
 Nov. 1 
 
 2,500.00 
 
 2,027.29 
 
 472.71 
 
 100,891.99 
 
 
 1919, May 1 
 
 2,500.00 
 
 2,017.84 
 
 482.16 
 
 100,409.83 
 
 
 Oct. 1 
 
 2,083.33 
 
 1,673.50 
 $22,255.83 
 
 409.83 
 
 100,000.00 
 
 
 
 $27,083.33 
 
 $4,827.50 
 
 
 § 142. Rule for Short Terminals 
 
 Ascertain the value of the bond for the full number of 
 periods, disregarding the terminal. To this value add the 
 short interest, and divide by the short ratio. 
 
 It may be remarked that this same process applies to 
 short initial periods. It even applies to bonds originally 
 issued between interest dates, and also maturing between 
 interest dates ; in the case of bonds of this description, the 
 process would be applied twice. 
 
 § 143. Discounting 
 
 Hitherto we have calculated the value of the bond at its 
 earliest date, and then obtained the successive values at 
 later dates by multiplication and subtraction. We can also 
 work backwards, however, obtaining each value from the 
 
VALUATION OF BONDS 
 
 107 
 
 next later one by addition and division. Let us take, for 
 illustration, the bond shown in Schedule (A), § 122: 
 
 Principal to be received at maturity, May 1, 
 
 1919 $100,000.00 
 
 Coupon to be received at May 1, 1919 2,500.00 
 
 Total amount receivable at May 1, 1919 $102,500.00 
 
 Discounted value at November 1, 1918, exclud- 
 ing the coupon receivable at that date, found 
 by dividing $102,500.00 by 1.02. $100,490.20 
 
 Coupon to be received at November 1, 1918 .... 2,500.00 
 
 Total value at November 1, 1918, including the 
 
 coupon receivable at that date $102,990.20 
 
 Discounted value at May 1, 1918, excluding the 
 coupon receivable at that date, found by divid- 
 ing $102,990.20 by 1.02 $100,9Y0.Y8 
 
 etc., etc. 
 
 In this manner successive terms may be obtained as far as 
 desired. 
 
 § 144. Last Half- Year of Bond 
 
 In the last half-year of a bond, its value should be dis- 
 counted, and not found as in § 128. Thus, if the bond men- 
 tioned in § 128 were sold three months prior to maturity, its 
 value would be found by dividing $102,500.00 by 1.01, 
 which would give $101,485.15 "flat," equivalent to $100,- 
 235.15 and interest; whereas by the ordinary rule it would 
 be $100,245.10 (that is, midway between $100,490.20 and 
 $100,000.00). The theoretically exact value (recognizing 
 effective rates, which is never done in business) would be 
 $100,240.13. This is found by multiplying the value six 
 months prior to maturity ($100,490.20) by the square root 
 of 1.02, this root to ten decimal places being 1.0099504938. 
 
Io8 THE MATHEMATICS OF INVESTMENT 
 
 The product is $101,490.13, which, less the accrued interest 
 amounting to $1,250.00, gives $100,240.13. To "split the 
 difference" would be an easy way of adjusting the matter, 
 and would be almost exact. 
 
 § 145. Serial Bonds 
 
 Bonds are often issued in series so that they mature at 
 various dates. For example, there may be an issue of 
 $30,000.00, of which $1,000.00 is payable after one year, 
 another $1,000.00 after two years, and so on, the final 
 $1,000.00 being payable after thirty years. Other series are 
 more complex, as, for example, $2,000.00 payable each 
 year for five years, and $4,000.00 each year thereafter for 
 ten years. The initial value of a series on any given basis 
 cannot be found by one operation ; the initial value of each 
 instalment must first be found, and the sum of these separate 
 initial values gives the initial value of the entire series. 
 After the aggregate initial value has been ascertained, it 
 may, for the purposes of deriving values at succeeding in- 
 terest periods, be treated as a unit, as if the bonds were 
 not in series. At the end of each of the yearly periods, the 
 ordinary amortization or accumulation would have to be 
 computed, and it would also be necessary to deduct from the 
 total value the par value- of the bonds cancelled or retired. 
 
 In offering serial bonds for sale, they are often listed as 
 of "average maturity — 15^/2 years." This is entirely de- 
 lusive, and frequently causes the buyer to believe that he is 
 getting a more favorable basis than will be realized. The 
 only correct valuation of a series is the sum of all its separate 
 values. If we assume that the $30,000.00 above referred to 
 was a series of 5% bonds bought on an assumed 3.50% 
 
 basis, the true value would be $35,005.00 
 
 whereas the value for the "average time," i.e., 
 
 151/2 years, would be 35,348.22 
 
VALUATION OF BONDS 
 
 109 
 
 In computing the rate of income yielded by a series, the 
 income rate corresponding to the average time may be taken 
 as a point of departure, but it will be found that it is in- 
 variably too high. For example, let us assume that the 
 thirty 5% serial bonds mentioned above were purchased 
 when first issued at 116.68, and that the income rate thereon 
 is desired. 
 
 Looking in Sprague's "Extended Bond Tables," under 
 the 5% bonds in the 15% year column (average date), we 
 
 find that the value nearest to 116.68 is $1,165,200.00 
 
 which is at a yield of approximately 3.60%. 
 
 If, however, we take off on an adding machine, 
 the value of a 5% bond due in 30 years at 
 
 3.60% $1,255,549.38 
 
 the value of a 5% bond due in 29 years at 
 
 3.60% 1,250,705.95 
 
 the value of a 5% bond due in 28 years at 
 
 3.60% 1,245,686.60 
 
 and so on, to and including the bond due in 
 1 year, we shall find that the total value of 
 
 the 30 bonds is 34,531,390.28 
 
 and that the average price is therefore 115.10. 
 
 An income yield of 3.55% for the above bonds will re- 
 sult in a value of 116.06, while a yield of 3.50% will dis- 
 close a value of 116.68. The true yield on these bonds, if 
 bought at 116.68, is therefore not 3.60%, as seems at first 
 apparent, but is 3.50%. 
 
 § 146. Irredeemable Bonds 
 
 Sometimes, as in the case of British Consols, there is 
 no right nor obligation of redemption. If the government 
 wishes to pay off any of its bonds, it has to buy them at the 
 market price. With this class of bonds, there is no question 
 of amortization; the investment is simply a perpetual an- 
 
no THE MATHEMATICS OF INVESTMENT 
 
 nuity. The cash interest is all revenue, and the original cost 
 is the constant book value. If £100 of 4% Consols be 
 bought at 96, the income is £4 per annum, and the book 
 value is £96. Since the investment of £96 produces £4 an- 
 nually, the rate of income is 4 -j- 96, or 4 1/6%. 
 
 § 147. Optional Redemption 
 
 Sometimes the issuer of a bond has the right to redeem 
 at a certain date earlier than the date at which he must 
 redeem. It must always be expected that this right will be 
 exercised if profitable to the issuer; hence, to be conserva- 
 tive, a purchaser, when buying this class of bonds at a 
 premium, must always consider them as maturing, or reach- 
 ing par, at the earlier date. On the other hand, bonds of 
 this character bought at a discount must be considered as 
 running to the longer date. If the bonds bought at a 
 premium run to the very latest date, or if the bonds bought 
 at a discount are called for redemption at an earlier date 
 than was anticipated by the investor, he will, in either case, 
 receive a higher yield in his income rate than he would have 
 received on the more conservative basis. The element of 
 chance enters in here, but, to be safe, the purchaser should 
 always consider that the chances will go against him ; he will 
 then have all to gain and nothing to lose. 
 
 The option of redemption is sometimes attended by a 
 premium. For example, the issuer of a thirty-year bond 
 reserves the right to redeem after twenty years at 105. 
 Where bonds are bought at such an income yield that after 
 twenty years the book value will be more than 105, the right 
 of redemption at 105 is a detriment to the purchaser. In 
 such a case as this, the safe and conservative purchaser 
 should buy at such an income basis as will bring the book 
 value at 105 or below at the end of twenty years. 
 
 There is also a form of bond issue, not uncommon in 
 
VALUATION OF BONDS HI 
 
 Europe, where a certain or indefinite number of bonds is 
 drawn by lot each year for the purposes of retirement. As 
 these bonds are usually issued at a discount, those which are 
 drawn at the earlier dates are the more profitable. The in- 
 vestor, however, in estimating his income, must assume that 
 his particular bonds will be among the last ones drawn. If 
 drawn at earlier dates, there is a profit exactly the same as 
 that arising from a sale above book value. 
 
 § 148. Bonds as Trust Fund Investments 
 
 A bond which has been purchased by a trustee at a 
 premium is subject to amortization in the absence of testa- 
 mentary instructions to the contrary. The trustee has no 
 right to pay over the full cash interest to the life tenant, 
 because he must keep the principal intact for the remainder 
 man. If, for example, the trustee were to invest $104,- 
 491.29 in a 5% bond having five years to run, and if he 
 were to pay over the full amount of the coupons to the life 
 tenant for the period of five years, the fund at the end of 
 the period would simply be the par value of the bonds, 
 $100,000.00, and would therefore be depleted to the extent 
 of $4,491.29, to the manifest injury of the remainder man. 
 Since the investment is on a 4% basis, the trustee should pay 
 over at the end of the first half-year only 2% of $104,491.29 
 (or $2,089.83),. and not 21/2% of $100,000.00 (or $2,- 
 500.00). He then has $410.17 cash to reinvest, and the fund, 
 including this, is still $104,491.29. It may be dif^cult to 
 invest the $410.17 at as favorable a rate as the bonds, very 
 small and very large amounts being most diflficult to invest. 
 The trustee can deposit it in a trust company, at least, and 
 receive interest at some rate, however small. 
 
 § 149. Payments to Life Tenant 
 
 At the end of the second half-year, the net income on 
 
112 THE MATHEMATICS OF INVESTMENT 
 
 the bond is only $2,081.62; but, in addition to this amount, 
 the life tenant is also entitled to the interest on the $410.17. 
 If this has been reinvested at exactly 4% (interest payable 
 semi-annually), the interest thereon is $8.20, and the total 
 amount payable to the life tenant is $2,081.62 + $8.20 = 
 $2,089.82. This is practically the same amount of income 
 as in the first half-year. The difference between the coupons 
 received ($2,500.00) and the net income ($2,089.82) is the 
 amortization ($418.38), which is deposited or invested as 
 before. The trustee now has in the fund : 
 
 Book value of the bonds ,. . .. .$103,662.74 
 
 Invested in Trust Company or otherwise at end 
 
 of first half-year , ,. . 410.17 
 
 Invested in Trust Company or otherwise at end 
 
 of second half-year 418.38 
 
 Total $104,491.29 
 
 He has paid over all of the new interest earned, and he 
 has kept the corpus or principal intact. 
 
 § 150. Effect of Varying Rates on Investments 
 
 Suppose, however, that the trustee was not able to get 
 4% on the $410.17, but only 3%, so that from this source 
 would come only $6.15, making the total income $2,081.62 
 plus $6.15, or $2,087.77. This shows a slight falling off in 
 income, but that is to be expected when part of an investment 
 is returned and reinvested at a lower rate. If the reinvest- 
 ment had been at 41/2%, the income would have been $2,- 
 090.85, slightly more than the first half-year, owing to the 
 improved demand for capital. It might be urged that the 
 life tenant ought to receive $2,089.83 semi-annually — no 
 more, no less — being at a 4% rate on $104,491.29. This 
 would leave $410.17 each half-year to be invested in a 
 
VALUATION OF BONDS 
 
 "3 
 
 Sinking fund, from which no interest should be drawn, but 
 which should be left to accumulate to maturity, when it 
 would exactly replace the premium, if compounded at 4%, 
 But this hope might not be realized. Very likely the average 
 rate would be less or more than 4% and not exactly 4%. 
 If less, the original fund would be to some extent depleted, 
 and the remainder man wronged; if more, there would be 
 too much in the fund, and the life tenant would receive too 
 little. It seems, therefore, that the sinking fund principle 
 is not correct in a case like this, and that, at all events, the 
 original fund should be kept constant, neither increased nor 
 diminished. So much of the semi-annual receipts as are not 
 necessary to maintain the constancy of the fund due to the 
 remainder man should be paid over as income to the life 
 tenant. 
 
 § 151. Example of Payments to Life Tenant 
 
 A two-year, 4% bond, par value $10,000, bought at 
 $10,192.72, would be scheduled thus : 
 
 Coupon 
 
 Income 
 
 Cash 
 
 Bond 
 
 
 
 
 $10,192.72 
 
 $200.00 
 
 $162.89 
 
 $47.11 
 
 10,146.61 
 
 200.00 
 
 152.18 
 
 47.82 
 
 10,097.79 
 
 200.00 
 
 151.47 
 
 48.63 
 
 10,049.26 
 
 200.00 
 
 150.74 
 
 49.26 
 
 10,000.00 
 
 $800.00 
 
 $607.28 
 
 $192.72 
 
 
 The life tenant would receive, at the end of the first half- 
 year, $152.89; at the end of the second, $152.18 + what- 
 ever the $47.11 cash had earned; at the end of the third, 
 $151.47 + whatever $94.93 had earned; at the close, 
 $150.74 -f whatever $143.46 had earned. If the cash bal- 
 
114 
 
 THE MATHEMATICS OF INVESTMENT 
 
 ance were periodically deposited in a trust company at 3% 
 (payable semi-annually), the life tenant would receive a uni- 
 form income of $152.89. 
 
 § 152. Cullen Decision 
 
 In a New York case (38 App. Div. 419), Justice Cullen 
 very clearly lays down the law as to the duty of the trustee 
 to reserve a part of the interest to provide for the premium, 
 and says that "any other view would lead to the impair- 
 ment of the principal of the trust, to protect the integrity 
 of which has always been the cardinal rule of courts of 
 equity." He says further : *'If one buys a ten-year five per 
 cent bond at one hundred and twenty, the true income or 
 interest the bond pays is not 4 1/6% on the amount in- 
 vested, nor 5% on the face of the bond, but 2 7/10% on 
 the investment, or 3 24/100% on the face of the bond. The 
 matter is simply one of arithmetical calculation, and 
 tables are readily accessible, showing the result of the 
 computation." 
 
 § 153. Cullen Decision Scheduled 
 
 Consulting one of the tables referred to by Justice Cullen 
 (Sprague's "Extended Bond Tables"), and looking in the 
 5% tables under the column headed "10 Years," we find 
 that the value nearest to $120,000.00 is $120,038,997, 
 which is opposite the net income rate of 2.70%. As stated 
 by Justice Cullen, the bonds, while bearing a coupon rate of 
 5%, actually net, therefore, only 2.7% on account of the 
 high premium. With a slight correction in the initial figures 
 in order to make the income rate exactly 2.7%, and assum- 
 ing a par value of $100,000.00, the illustration as given in 
 the above case by Justice Cullen, when tabulated to show 
 the present value, the income, and the amount reinvested, 
 would work out as follows : 
 
VALUATION OF BONDS 
 
 115 
 
 Total 
 Interest 
 
 Income 
 Paid Over 
 
 Reinvested 
 
 Present 
 
 Value 
 
 
 
 
 $120,039.00 
 
 $2,500.00 
 
 $1,620.53 
 
 $879.47 
 
 119,159.53 
 
 2,500.00 
 
 1,608.65 
 
 891.35 
 
 118,268.18 
 
 2,500.00 
 
 1,596.62 
 
 903.38 
 
 117,364.80 
 
 2,500.00 
 
 1,584.42 
 
 915.58 
 
 116,449.22 
 
 2,500.00 
 
 1,572.07 
 
 927.93 
 
 115,521.29 
 
 2,500.00 
 
 1,559.53 
 
 940.47 
 
 114,580.82 
 
 2,500.00 
 
 1,546.85 
 
 953.15 
 
 113,627.67 
 
 2,500.00 
 
 1,533.97 
 
 966.03 
 
 112,661.64 
 
 2,500.00 
 
 1,520.93 
 
 979.07 
 
 111,682.57 
 
 2,500.00 
 
 1,507.72 
 
 992.28 
 
 110,690.29 
 
 2,500.00 
 
 1,494.31 
 
 1,005.69 
 
 109,684.60 
 
 2,500.00 
 
 1,480.75 
 
 1,019.25 
 
 108,665.35 
 
 2,500.00 
 
 1,466.93 
 
 1,033.07 
 
 107,632.28 
 
 2,500.00 
 
 1,453.08 
 
 1,046.92 
 
 106,585.36 
 
 2,500.00 
 
 1,438.91 
 
 1,061.09 
 
 105,524.27 
 
 2,500.00 
 
 1,424.57 
 
 1,075.43 
 
 104,448.84 
 
 2,500.00 
 
 1,410.06 
 
 1,089.94 
 
 103,358.90 
 
 2,500.00 
 
 1,395.35 
 
 1,104.65 
 
 102,254.25 
 
 2,500.00 
 
 1,380.43 
 
 1,119.57 
 
 101,134.68 
 
 2,500.00 
 
 1,365.32 
 
 1,134.68 
 
 100,000.00 
 
 $50,000.00 
 
 $29,961.00 
 
 $20,039.00 
 
 
 § 154. Unjust Feature of Cullen Decision 
 
 The foregoing schedule is perfectly correct, but we can 
 scarcely agree with the method described further on in the 
 same opinion, as follows: "There is, however, a simpler 
 way of preserving the principal intact — the method adopted 
 by the learned referee. He divided the premium paid for 
 the bonds by the number of interest payments, which would 
 
ii6 
 
 THE MATHEMATICS OF INVESTMENT 
 
 be made up to the maturity of the bonds, and held that the 
 quotient should be deducted from each interest payment 
 and held as principal. These deductions being principal, 
 the life tenant would get the benefit of any interest that 
 they might earn. We do not see why this plan does not 
 work equal justice between the parties." The reason "why 
 it does not work equal justice" is that the life tenant in the 
 earlier years receives much less than his due share of the 
 income, but from year to year he gradually receives more 
 and more, until he receives more than his share; but not 
 until the very last payment does he overtake his true share. 
 Thus, if he dies before the maturity of the bonds, it is cer- 
 tain that "equal justice" will not have been done, and that 
 the remainder man will have had altogether the best of it. 
 The schedule under the referee's plan would work out as 
 follows : 
 
 Total 
 Interest 
 
 Income 
 Paid Over 
 
 Reinvested 
 
 Present 
 Value 
 
 
 
 
 $120,039.00 
 
 $2,500.00 
 
 $1,498.05 
 
 $1,001.95 
 
 119,037.05 
 
 2,600.00 
 
 1,498.05 
 
 1,001.95 
 
 118,035.10 
 
 2,500.00 
 
 1,498.05 
 
 1,001.95 
 
 117,033.15 
 
 2,500.00 
 
 1,498.05 
 
 1,001.95 
 
 116,031.20 
 
 2,500.00 
 
 1,498.05 
 
 1,001.95 
 
 115,029.25 
 
 2,500.00 
 
 1,498.05 
 
 1,001.95 
 
 114,027.30 
 
 2,500.00 
 
 1,498.05 
 
 1,001.95 
 
 113,025.35 
 
 2,500.00 
 
 1,498.05 
 
 1,001.95 
 
 112,023.40 
 
 2,500.00 
 
 1,498.05 
 
 1,001.95 
 
 111,021.45 
 
 3,500.00 
 
 1,498.05 
 
 1,001.95 
 
 110,019.50 
 
 etc. 
 
 etc. 
 
 etc. 
 
 etc. 
 
 Assuming that, under each plan, the reinvested funds 
 would earn the same rate of income as the oriynal invest- 
 
VALUATION OF BONDS II7 
 
 ment (i.e., 2.7%), the total semi-annual income of the re- 
 mainder man would be as follows : 
 
 Under Plan Under Plan 
 
 in § 153 in § 154 
 
 $1,620.53 $1,498.05 
 
 1,620.53 1,511.58 
 
 1,620.53 1,525.10 
 1,620.53 . 1,538.63 
 
 1,620.53 1,552.16 
 
 1,620.53 1,565.68 
 
 1,620.53 1,579.21 
 
 1,620.53 1,592.73 
 
 1,620.53 1,606.26 
 
 1,620.53 1,619.79 
 
 etc. etc. 
 
 A comparison of the two columns will show the injus- 
 tice of the referee's plan toward the life tenant, and sub- 
 stantiate the equity of the plan of scientific amortization set 
 forth in the schedule in § 153. 
 
 § 155. Bond Tables 
 
 Mention has been made heretofore of bond tables. These 
 tables show the values of bonds at various coupon rates, 
 yielding various rates of net income, and due in different 
 periods from one-half year to one hundred years. The usual 
 tables refer to bonds whose coupons are payable semi- 
 annually, but there are generally supplementary tables by 
 the use of which values of those bonds may be ascertained 
 whose coupons are payable annually or quarterly. The fol- 
 lowing table is taken from page 80 of Sprague's "Extended 
 Bond Tables," and sets forth (in part) the values of the 
 bond mentioned in Schedule (A), §122: 
 
ii8 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Bond Table 
 
 Values, to the Nearest Cent, of a Bond for $1,000,000 at 
 6% Interest, Payable Semi-Annually 
 
 Net 
 In- 
 come 
 
 3 Years 
 
 3J^ Years 
 
 4 Years 
 
 4^ Years 
 
 5 Years 
 
 2.50 
 2.55 
 2.60 
 2.65 
 2.70 
 2.75 
 2.80 
 2.85 
 2.90 
 2.95 
 3.00 
 3.05 
 3.10 
 3.15 
 3.20 
 3.25 
 3.30 
 3.35 
 3.40 
 3.45 
 3.50 
 3.55 
 3.60 
 3.65 
 3.70 
 3.75 
 3.80 
 3.85 
 3.90 
 3.95 
 4.00 
 4.05 
 4.10 
 4.15 
 4.20 
 4.2S 
 
 ,071,825.12 
 ,070,328.46 
 ,068,834.33 
 ,067,342.73 
 ,065,853.65 
 ,064,367.09 
 ,062,883.04 
 ,061,401.50 
 ,059,922.46 
 ,058,445.92 
 ,056,971.87 
 ,055,500.31 
 ,054,031.24 
 ,052,564.64 
 ,051,100.52 
 ,049,638.87 
 ,048,179.68 
 ,046,722.96 
 ,045,268.68 
 ,043,816.86 
 ,042,367.48 
 ,040,920.54 
 ,039,476.04 
 ,038,033.97 
 ,036,594.33 
 ,035,157.11 
 ,033,722.30 
 ,032,289.91 
 ,030,859.92 
 ,029,432.34 
 ,028,007.15 
 ,026,584.36 
 ,025,163.96 
 ,023,745.94 
 ,022,330.31 
 ,020,917.04 
 
 1,083,284.07 
 1,081,538.84 
 1,079,796.97 
 1,078,058.45 
 1,076,323.28 
 1,074,591.45 
 1,072,862.96 
 1,071,137.78 
 1,069,415.93 
 1,067,697.38 
 1,065,982.14 
 1,064,270.19 
 1,062,561.54 
 1,060,856.16 
 1,059,154.06 
 1,057,455.22 
 1,055,759.65 
 1,054,067.33 
 1,052,378.25 
 1,050,692.42 
 1,049,009.81 
 1,047,330.43 
 1,045,654.27 
 1,043,981.31 
 1,042,311.57 
 1,040,645.01 
 1,038,981.65 
 1,037,321.47 
 1,035,664.46 
 1,034,010.63 
 1,032,359.96 
 1,030,712.44 
 1,029,068.07 
 1,027,426.84 
 1,025,788.74 
 1,024,153.77 
 
 1,094,601.55 
 1,092,608.09 
 1,090,618.92 
 1,088,634.05 
 1,086,653.46 
 1,084,677.14 
 1,082,705.08 
 1,080,737.28 
 1,078,773.71 
 1,076,814.37 
 1,074,859.25 
 1,072,908.34 
 1,070,961.63 
 1,069,019.11 
 1,067,080.77 
 1,065,146.59 
 1,063,216.58 
 1,061,290.71 
 1,059,368.98 
 1,057,451.38 
 1,055,537.90 
 1,053,628.52 
 1,051,723.25 
 1,049,822.06 
 1,047,924.95 
 1,046,031.91 
 1,044,142.93 
 1,042,258.00 
 1,040,377.11 
 1,038,500.25 
 1,036,627.41 
 1,034,758.58 
 1,032,893.74 
 1,031,032.90 
 1,029,176.04 
 1,027,323.16 
 
 1,105,779.31 
 1,103,537.98 
 1,101,302.00 
 1,099,071.36 
 1,096,846.04 
 1,094,626.03 
 1,092,411.33 
 1,090,201.90 
 1,087,997.74 
 1,085,798.84 
 1,083,605.17 
 1,081,416.74 
 1,079,233.51 
 1,077,055.49 
 1,074,882.64 
 1,072,714.97 
 1,070,552.46 
 1,068,395.09 
 1,066,242.85 
 1,064,095.73 
 1,061,953.71 
 1,059,816.78 
 1,057,684.92 
 1,055,558.13 
 1,053,436.38 
 1,051,319.67 
 1,049,207.98 
 1,047,101.30 
 1,044,999.62 
 1,042,902.92 
 1,040,811.18 
 1,038,724.41 
 1,036,642.57 
 1,034,565.67 
 1,032,493.68 
 1,030,426.59 
 
 1,116,819.07 
 1,114,330.27 
 1,111,847.97 
 1,109,372.18 
 1,106,902.85 
 1,104,439.98 
 1,101,983.56 
 1,099,533.55 
 1,097,089.94 
 1,094,652.71 
 1,092,221.85 
 1,089,797.33 
 1,087,379.13 
 1,084,967.25 
 1,082,561.66 
 1,080,162.34 
 1,077,769.27 
 1,075,382.44 
 1,073,001.82 
 1,070,627.41 
 1,068,259.17 
 1,065,897.10 
 1,063,541.18 
 1,061,191.38 
 1,058,847.70 
 1,056,510.11 
 1,054,178.59 
 1,051,853.13 
 1,049,533.71 
 1,047,220.32 
 1,044,912.93 
 1,042,611.52 
 1,040,316.09 
 1,038,026.61 
 1,035,743.07 
 1,033,465.45 
 
VALUATION OF BONDS 
 
 119 
 
 Net 
 In- 
 come 
 
 3 Years 
 
 354 Years 
 
 4 Years 
 
 454 Years 
 
 5 Years 
 
 4.30 
 
 1,019,506.15 
 
 1,022,521.93 
 
 1,025,474.23 
 
 1,028,364.40 
 
 1,031,193.73 
 
 4.35 
 
 1,018,097.62 
 
 1,020,893.20 
 
 1,023,629.26 
 
 1,026,307.08 
 
 1,028,927.90 
 
 4.40 
 
 1,016,691.46 
 
 1,019,267.57 
 
 1,021,788.23 
 
 1,024,254.63 
 
 1,026,667.93 
 
 4.45 
 
 1,015,287.65 
 
 1,017,645.05 
 
 1,019,951.13 
 
 1,022,207.03 
 
 1,024,413.82 
 
 4.50 
 
 1.013,886.19 
 
 1,016,025.62 
 
 1,018,117.96 
 
 1,020,164.27 
 
 1,022,165.54 
 
 4.55 
 
 1,012,487.08 
 
 1,014,409.27 
 
 1,016,288.70 
 
 1,018,126.33 
 
 1,019,923.08 
 
 4.60 
 
 1,011,090.32 
 
 1,012,796.01 
 
 1,014,463.35 
 
 1,016,093.21 
 
 1,017,686.42 
 
 4.65 
 
 1,009,695.89 
 
 1,011,185.82 
 
 1,012,641.90 
 
 1,014,064.89 
 
 1,015,455.55 
 
 4.70 
 
 1,008,303.80 
 
 1,009,578.70 
 
 1,010,824.33 
 
 1,012,041.35 
 
 1,013,230.44 
 
 4.75 
 
 1,006,914.03 
 
 1,007,974.64 
 
 1,009,010.63 
 
 1,010,022.60 
 
 1,011,011.08 
 
 4.80 
 
 1,005,526.59 
 
 1,006,373.63 
 
 1,007,200.81 
 
 1,008,008.60 
 
 1,008,797.46 
 
 4.85 
 
 1,004,141.48 
 
 1,004,775.67 
 
 1,005,394.84 
 
 1,005,999.36 
 
 1,006,589.56 
 
 4.90 
 
 1,002,758.67 
 
 1,003,180.75 
 
 1,003,592.72. 
 
 1,003,994.85 
 
 1,004,387.36 
 
 4.95 
 
 1,001,378.18 
 
 1,001,588.86 
 
 1,001,794.45 
 
 1,001,995.07 
 
 1,002,190.85 
 
 5.00 
 
 1,000,000.00 
 
 1,000,000.00 
 
 1,000,000.00 
 
 1,000,000.00 
 
 1,000,000.00 
 
 § 156. Features of the Bond Table 
 
 The relations existing between succeeding values on the 
 same horizontal line of the table are readily seen, these 
 values being computed at the same income rate but for 
 different semi-annual periods. For example, on a 2.50% 
 basis, the value of this 5% bond 5 years prior to maturity is 
 $1,116,819.07. At 4% years prior to maturity, its value is 
 1.0125 (which is the semi-annual income rate) times $1,- 
 116,819.07, producing $1,130,779.31, from which must be 
 deducted the semi-annual coupons ($25,000.00), giving as 
 a final result $1,105,779.31.- The net income yields shown 
 in the preceding table vary to the extent of .05%. Usually 
 there are supplementary tables by the use of which values 
 of bonds may be calculated at different income yields differ- 
 ing by only .01%. In this manner, the values of the bond 
 shown in the preceding table may be computed on an income 
 yield of 2.51%, 2.52%, 2.53%, etc. 
 
CHAPTER XII 
 
 SUMMARY OF COMPOUND INTEREST 
 PROCESSES 
 
 § 157. Rules and Formulas 
 
 In the present chapter are given in condensed and sym- 
 bolic form the rules and formulas which have been explained 
 in the preceding chapters. 
 
 § 158. Rules 
 
 (1) To find the ratio of increase : 
 
 Add 1 to the rate of interest. 
 
 (2) To find the amount of $1 : 
 
 Multiply 1 by the ratio as many times as there 
 are periods. 
 
 (3) To find the present worth of $1, or to discount $1 : 
 
 Divide 1 by the ratio as many times as there 
 are periods. 
 
 (4) To find the total interest on $1 : 
 
 Subtract 1 from the amount. 
 
 (5) To find the total discount on $1 : 
 
 Subtract the present worth from 1. 
 
 (6) To find the amount of an annuity of $1 : 
 
 Divide the total interest by the rate of interest. 
 
 (7) To find the present worth of an annuity of $1 : 
 
 Divide the total discount by the rate of interest. 
 120 
 
COMPOUND INTEREST PROCESSES 12 1 
 
 (8) To find the rent of an annuity worth $1, or what 
 
 annuity can be bought for $1 : 
 
 Divide 1 by the present worth of the annuity. 
 
 (9) To find what annuity (sinking fund) will produce 
 
 $1: 
 
 Divide 1 by the amount of the annuity, 
 
 (10) To find the premium on a bond, or the discount on 
 
 a bond : 
 
 Consider the difference between the cash and 
 income rates as an annuity to be valued, and 
 find its present worth at the income rate. 
 
 ( 11 ) To find the value of a bond : 
 
 In case the cash rate is greater than the income 
 rate, the bond is at a premium; therefore, 
 add par to the premium. 
 
 In case the income rate is greater than the cash 
 rate, the bond is at a discount; therefore, 
 subtract the discount from par. 
 
 § 159. Formulas 
 
 i is the rate of interest or the interest on unity for 1 
 period, n is the number of periods, c is the cash rate on a 
 bond. 
 
 (1) Ratio of Increase = 
 
 1 + i 
 
 (2) Amount = 
 
 (1+ir 
 
 (3) Present Worth &i ^C-"^**^ 
 
 1 
 
 (i+ir 
 
 (4) Total Interest = 
 
 (i+ir-i 
 
 (5) Total Discount = 
 
 1- 1 
 
122 THE MATHEMATICS OF INVESTMENT 
 
 (6) Amount of Annuity = 
 
 (7) Present Worth of An- 
 nuity 
 
 (8) Rent of Annuity 
 
 (9) Sinking Fund 
 
 i 
 1 
 
 X — 
 
 (1+ir 
 
 i 
 i 
 
 1- 
 
 1 
 
 i 
 
 (l+i)**-! 
 
 (10) Premium on Bond = — : — ( 1 — .^ , .. „ ) 
 
 (11) Discount on Bond = — ; — ( 1 — .^ , ..„ ) 
 
 (12) Value of Bond (at a ^^ , c-j / _ 1 \ 
 
 Premium) i \ (l + i)**/ 
 
 (13) Value of Bond (at a ^ i- c / _ 1 \ 
 
 Discount)* ^ * \ (l + iy) 
 
 • This formula is equivalent to Formula (12). 
 
CHAPTER XIII 
 
 ACCOUNTS— GENERAL PRINCIPLES 
 
 § 1 60. Relation of General Ledger to Subordinate Ledgers 
 
 In any extensive system of accountancy, in order to 
 fulfill the opposite requirements of minuteness and compre- 
 hensiveness, it is necessary to keep, in some form, a general 
 ledger and various subordinate ledgers. Each account in 
 the general ledger, as a rule, comprises or summarizes the 
 entire contents of one subordinate ledger. Each account of 
 the general ledger comprises groups of similar accounts, 
 which are handled in the subordinate ledgers as individual 
 assets or as groups which may be treated as individuals. It 
 is the province of the general ledger to give information 
 in grand totals as an indicator of tendencies; while the 
 function of the subordinate ledger is to give all desired in- 
 formation as to details, even beyond the figures required 
 for balancing — facts not only of numerical accountancy, but 
 descriptive, cautionary, or auxiliary. Thus the general 
 ledger may contain a ''Mortgages" account, which will show 
 the increase or decrease of the amount invested on mortgage, 
 and the resultant or present amount; the mortgage ledger 
 will contain an account for each separate mortgage, with 
 additional information as to interest, taxes, insurance, title, 
 ownership, security, valuation, or any other thing useful 
 or necessary to be known. 
 
 § 161. The Interest Account 
 
 We shall assume that a general ledger exists with subor- 
 dinate or class ledgers. We shall also assume that the 
 
 123 
 
124 THE MATHEMATICS OF INVESTMENT 
 
 accounts are to be so arranged as to give currently the 
 amount of interest earned up to any time, and the amount 
 outstanding and overdue at any time. It would hardly 
 seem necessary to argue this point, were it not that many 
 large investors pay no attention to interest until it matures, 
 and some do not carry it into their accounts until it is paid. 
 They are compelled to make an adjustment on their 
 periodical balancing dates "in the air," compiling it from 
 various sources without check, which seems as crude as it 
 would be to take no account of cash, except by counting it 
 occasionally. The Profit and Loss account depends for its 
 accuracy upon the interest earned, not upon the interest 
 falling due, nor upon the interest collected ; and the accruing 
 of interest is a fact which should be recognized and recorded. 
 
 § 162. Mortgage and Loan Accounts 
 
 In considering the forms of account for investments, we 
 will first take up, as being simpler, those in which there is 
 never any value to be considered other than par, such as 
 mortgages and loans upon collateral security. Both of these 
 classes of investments are for comparatively short terms, 
 and are usually the result of direct negotiation between 
 borrower and lender, and not the subject of purchase and 
 sale; hence, changes in rate of interest are readily effected 
 by agreement, and do not result in a premium or discount. 
 
CHAPTER XIV 
 
 REAL ESTATE MORTGAGES 
 
 §163. Nature of Loans on Bond and Mortgage 
 
 The instruments which we have spoken of as "bonds" 
 are very often secured by a mortgage of property. But one 
 mortgage will secure a great number of bonds, the mort- 
 gagee being a trustee for all the bondholders. In contrast 
 with these instruments, those of which we now speak are 
 the ordinary *'bond and mortgage," by which the investor 
 receives from the borrower two instruments : the one an 
 agreement to pay, and the other conferring the right, in 
 case default is made, to have certain real estate sold, and 
 the proceeds used to pay the debt. As only a portion of the 
 value of the real estate is loaned, the reliance is primarily 
 on the mortgage rather than on the bond. Therefore, the 
 mortgagee must be vigilant in seeing that his margin is 
 not reduced to a hazardous point. This may happen by the 
 depreciation of the land for various economic reasons; by 
 the deterioration of the structures thereon through time or 
 neglect; by destruction through fire; or by the non-payment 
 of taxes, which are a lien superior to all mortgages. By 
 reason of these risks a mortgage loan is seldom made for 
 more than a few years ; but after the date of maturity, ex- 
 tensions are made from time to time; or, even more fre- 
 quently, without formal extension, the loan is allowed to 
 remain "on demand," either party having the right to ter- 
 minate the relation at will. A large proportion of outstand- 
 ing mortgages are thus "on sufferance," or payable on 
 
 125 
 
126 THE MATHEMATICS OF INVESTMENT 
 
 demand. The market rate of interest seldom causes the 
 obHgation to change hands at either a premium or a dis- 
 count; hence we may ignore that feature, referring the 
 exceptional cases, where it occurs, to the analogy of bonds. 
 The two instruments, bond and mortgage, relate to the 
 same transaction, are held by the same owner, and for most 
 purposes are treated as a unit. In bookkeeping, the invest- 
 ment must likewise be treated as a unit, both as to principal 
 and income. 
 
 § 164. Separate Accounts for Principal and Interest 
 
 It is desirable to know at any time how much is due on 
 principal, allowing for any partial payments. It is also de- 
 sirable to know what interest, if any, is due and payable, and 
 to be able to look after its collection. An account with 
 principal and an account with interest are therefore requisite. 
 It is better, however, if these two accounts for the same 
 mortgage be adjacent. 
 
 § 165. Interest Debits and Credits 
 
 Accrued interest need not be considered as to each 
 mortgage. It should be treated in bulk, in the same manner 
 as the revenue of the aggregate mortgages, as will be ex- 
 plained hereafter. The Interest account (on the investor's 
 books) here referred to is debited on the day when the inter- 
 est becomes a matured obligation, and credited when that 
 obligation is discharged. 
 
 § 166. Characteristics of Modern Ledger 
 
 Those who adhere to the original form of the Italian 
 ledger will probably be averse to combining with the ledger 
 account any general business information ; in fact, that form 
 is not suited for such purposes, and is not adapted to con- 
 taining anything but the bare figures that will make the 
 
J J 
 
 REAL ESTATE MORTGAGES 
 
 127 
 
 trial balance prove. But the modern conception of a ledger 
 is broader and more practical : it should be an encyclopedia 
 of information bearing on the subject of the account; it 
 should be specialized for every class ledger ; it should be of 
 any form which will best serve its purposes, regardless of 
 custom or tradition. 
 
 § 167. The Mortgage Ledger 
 
 The form of mortgage ledger which seems best to the 
 author contains four parts : 
 
 (1) Descriptive. 
 
 (2) Account with principal. 
 
 (3) Account with interest. 
 
 (4) Auxiliary information. 
 
 These may occupy four successive pages, or two pages, if 
 preferred. In the latter case, if kept in a bound volume, the 
 arrangement whereby two of these parts are on the left- 
 hand page and two on the right, confronting each other, is 
 a convenient one, giving all the facts at one view. For a 
 loose-leaf ledger, the order (1), (2), (3), (4) will generally 
 be found the best. 
 
 § 168. Identification of Mortgages by Number 
 
 Mortgages should be numbered in chronological order, 
 and every page or document should bear the number of the 
 mortgage loan to which it refers. 
 
 § 169. The "Principal" Account 
 
 The account with principal may be in the ordinary 
 ledger form; but what is known as the balance-column, or 
 three-column form, will be found more convenient. It con- 
 tains but one date column, so that successive transactions, 
 whether payments on account, or additional sums loaned, 
 appear in their proper chronological order. 
 
128 THE MATHEMATICS OF INVESTMENT 
 
 § 170. Special Columns for Mortgagee's Disbursements 
 
 The mortgage usually contains clauses which permit the 
 mortgagee, when the mortgagor fails to make any necessary 
 payment for the benefit of the property, like taxes and in- 
 surance premiums, to step in and advance the money, which 
 he has the right to recover with interest. It will be use- 
 ful to have columns for these disbursements and the corre- 
 sponding reimbursements (§ 179, Form II). 
 
 § 171. The Interest Account 
 
 The Interest account (§ 179, Form III) may be very 
 simple. It contains two columns, one for debits on the day 
 when interest falls due, the other for crediting when it is 
 collected. The entries in the Interest account will naturally 
 be much more numerous than in the Principal account; 
 hence, this pair of columns may be repeated several times. 
 The arrangement shown has been found advantageous. 
 
 § 172. Interest Due 
 
 Experience has shown that the safest way to insure at- 
 tention to the punctual and accurate collection of interest is 
 to charge up, systematically, under the due date, every item, 
 and to let it stand as a debit balance until collected. Many 
 attempt to accomplish the same purpose by merely marking 
 "paid" on a list; but this is apt to lead to confusion, and 
 it is difficult to verify afterward the state of the accounts 
 on any given date. 
 
 § 173. Books Auxiliary to Ledger 
 
 It is not proposed in. this treatise to prescribe the 
 forms of posting mediums (cash book, journal, etc.) from 
 which the postings in the ledger are made, because these 
 forms are so largely dependent upon the peculiarities of the 
 
REAL ESTATE MORTGAGES 1 29 
 
 business, and have deviated so far from the traditional 
 Italian form, that no universal type could be presented. We 
 shall, however, give the debit and credit formulas underlying 
 the postings, and will suggest auxiliary books or lists for 
 making up the entries. 
 
 § 174. The "Due" Column 
 
 The formula for the "Due" column of the Interest 
 account is : 
 
 Interest Due / Interest Accrued $ 
 
 It is a transfer from one branch of interest receivable, viz., 
 that which is a debt, but not yet enforceable, to another 
 branch, viz., that which is a matured claim. 
 
 § 175. Interest Account Must Be Analyzed 
 
 In the general ledger the entry will be simply as above : 
 
 Interest Due / Interest Accrued $ 
 
 and this may be a daily, weekly, or monthly entry, or for 
 any other space of time, according to the general practice 
 of the business ; the monthly period is most in use, and we 
 shall take that as the standard. The credit side of the entry 
 (/ Interest Accrued) is not regarded in the subordinate 
 ledger (§160), but the debit entry (Interest Due /) must 
 be somewhere analyzed into its component parts; in other 
 words, there must be somewhere a list, the total of which is 
 the aggregate falling due on all mortgages, and the items 
 of which are the interest falling due on each mortgage. 
 
 § 176. Form of "Interest Due" Account 
 
 The following heading will suggest the requirements 
 for such a list, the form to be modified to conform to the 
 general system. 
 
130 THE MATHEMATICS OF INVESTMENT 
 
 Register of Interest Due 
 Mortgages 
 
 Date 
 
 No. 
 
 Principal Rate 
 
 Time Interest Total 
 
 § 177. Forms for Mortgage Account 
 
 Form I (§ 179) of the Mortgage account is descriptive. 
 Its elements may be placed in various orders of arrange- 
 ment. Form IV (§ 179) combines all the particulars or- 
 dinarily required in the State of New York. 
 
 § 178. Loose-Leaf and Card Records 
 
 Form IV (§ 179) is not an essential feature of mortgage 
 loan accounts, and may be replaced by card lists, if pre- 
 ferred. Yet, if there is space, there are advantages in hav- 
 ing all the information about a certain mortgage accessible 
 at one time, and concentrated in one place. The changing 
 names and addresses of the mortgagors and owners, and the 
 successive policies of insurance require for their record 
 considerable space, which may be conveniently arranged 
 under the headings in Form IV. 
 
 The card form of mortgage ledger is very convenient 
 in many respects, and the forms here given may be re- 
 arranged to suit different sizes of cards. Both in cards and 
 loose leaves it will be helpful to use different colors for 
 pages of different contents. Where interest on different 
 mortgages fall due in different months, tags marked "J J," 
 "F A,'* "M S," "A O," "M N," and "J D," may project 
 from the interest-sheet like an index, the tags of each 
 month at the same distance from the top. This will greatly 
 facilitate the compiling of the register of interest due. 
 
REAL ESTATE MORTGAGES 
 § 179. Forms of Mortgage Loan Accounts 
 
 131 
 
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REAL ESTATE MORTGAGES 
 
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 THE MATHEMATICS OF INVESTMENT 
 
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REAL ESTATE MORTGAGES 
 
 135 
 
 § 180. Reverse Posting of Interest Register 
 
 The interest register should always be made up and 
 proved (subjected to modifications) in advance. In doing 
 this, instead of making the computations in the register and 
 posting thence to the ledger, a surer way is by "reverse 
 posting" ; that is, making the computation from the data in 
 the ledger and entering it there at once, in pencil if pre- 
 ferred; then copying the items into the register, where the 
 total can be proved. When this has been done, we can be 
 sure without further check that the ledger is correct. (See 
 also §183.) 
 
 § 181. Handling Receipts and Notices 
 
 It is desirable, also, to have receipts prepared in advance 
 ready for signature. The correctness of these receipts may 
 be assured by introducing them into the "reverse posting" 
 process, as follows: Having made the computation on the 
 ledger, prepare the receipts from the ledger, copying down 
 the figures just as they appear; from the receipts make up 
 the register, which prove as before. This method may be 
 extended to the notices, if any are sent to the mortgagors, 
 the notice being derived from ledger account, the receipt 
 from the notice, and the register from the receipt; if the 
 register proves correct, the correctness of its antecedents is 
 established. These interest notices may be made of as- 
 sistance in the bookkeeping, if their return is insisted upon 
 and made convenient. Below the formal notification of the 
 sum falling due on such a date, with all particulars, is a 
 blank form somewhat as follows : 
 
 In payment of the above interest I inclose check on the 
 
 for $ and 
 
 request you to acknowledge receipt as per the address below. 
 
 Signature 
 
 Address 
 
136 
 
 THE MATHEMATICS OF INVESTMENT 
 
 The notice upon its being received, together with the 
 check, becomes a "voucher-with-cash," and the entries on 
 the cash book and the interest page of the mortgage ledger 
 are made directly from the documents. Book-to-book post- 
 ing, which formerly was the only method of rearranging 
 items, is becoming obsolete, being superseded in many busi- 
 nesses by voucher or document posting. By the carbon 
 process the notice and the receipt may be filled in simulta- 
 neously in fac-simile. 
 
 § 182. Mortgages Account in General Ledger 
 
 The class account "Mortgages" in the general ledger is 
 simply kept to show aggregates. Its entries are, as far as 
 possible, monthly, the posting mediums being so arranged 
 as to give a monthly total of the same items which have al- 
 ready been posted in detail to the mortgage ledger. The 
 standard form of ledger account may be used, or the three 
 column. In the former, the debits and credits of the same 
 month should be kept in line, even though one line of paper 
 be wasted. 
 
 (Standard Form) 
 
 Mortgages 
 
 1914 
 
 
 
 
 1914 
 
 
 
 
 Jan. 
 
 Balance 
 
 $169,000 
 
 00 
 
 
 
 
 
 
 1-31 
 
 Total loaned 
 
 12,000 
 
 00 
 
 Jan. 
 
 1-31 
 
 Total paid in 
 
 $ 7,000 
 
 00 
 
 Feb. 1-28 
 
 <( « 
 
 10,000 
 
 00 
 
 
 
 
 
 
 March 1-31 
 
 « X 
 
 50,000 
 
 00 
 
 March 
 
 1-31 
 
 « « <t 
 
 32,000 
 
 00 
 
 April 1-30 
 
 .. 
 
 20,000 
 
 00 
 
 April 
 
 1-30 
 
 << << << 
 
 40,000 
 
 00 
 
 May 1-31 
 
 <l « 
 
 5,000 
 
 00 
 
 May 
 
 1-31 
 
 « « t< 
 
 12,000 
 
 00 
 
 June 1-30 
 
 <( t< 
 
 10,000 
 
 00 
 
 June 
 
 1-30 
 
 <t << << 
 
 3,000 
 
 00 
 
 
 Balance 
 
 
 00 
 
 
 30 
 
 Balance 
 
 182,000 
 
 00 
 
 
 $276,000 
 
 $276,000 
 
 00 
 
 July 
 
 $182,000 
 
 00 
 
 
 
REAL ESTATE MORTGAGES 
 
 137 
 
 (Three-Column Form) 
 
 Mortgages 
 
 
 Dk. 
 
 Cr. 
 
 Balance 
 
 1914 
 Jan. 
 
 
 
 
 
 
 $169,000 
 
 00 
 
 " 
 
 Transactions for month 
 
 $ 12,000 
 
 00 
 
 $ 7,000 
 
 00 
 
 174,000 
 
 00 
 
 Feb. 
 
 ♦. .t 
 
 ' 
 
 10,000 
 
 00 
 
 
 
 184,000 
 
 00 
 
 March 
 
 « 
 
 ' 
 
 50,000 
 
 00 
 
 32,000 
 
 00 
 
 202,000 
 
 00 
 
 April 
 
 « « 
 
 ' 
 
 20,000 
 
 00 
 
 40,000 
 
 00 
 
 182,000 
 
 00 
 
 May 
 
 « « 
 
 ' 
 
 5,000 
 
 00 
 
 12,000 
 
 00 
 
 175,000 
 
 00 
 
 June 
 
 Transactions for half-year 
 
 10,000 
 
 00 
 00 
 
 3,000 
 
 00 
 00 
 
 182,000 
 
 00 
 
 
 $107,000 
 
 $94,000 
 
 + $ 13,000 
 
 00 
 
 July 
 
 
 
 
 
 $182,000 
 
 00 
 
 § 183. Tabular Register 
 
 In order to keep the fullest control of the interest accru- 
 ing and falling due periodically, it is useful to keep tabular 
 registers, classifying the mortgages, first, by rates of in- 
 terest; and second, by the months in which the interest 
 comes due. Those investors who require all interest to be 
 paid at the same date can dispense with the latter. The two 
 presentations or developments may be on opposite pages, 
 both proved by the same totals. 
 
 Form I 
 Mortgages Classified by Rates of Interest 
 
 Date 
 
 Total 
 
 Changes 
 
 3^% 
 
 4% 
 
 4H% 
 
 5% 
 
 6% 
 
 1914 
 
 Jan.O 
 
 $169,000 
 7,000 
 
 262- 
 984 + 
 
 $11,000 
 
 $43,000 
 7,000 
 
 $50,000 
 12,000 
 
 $60,000 
 
 $5,000 
 
 
 $162,000 
 12,000 
 
 
 Feb.O 
 
 $174,000 
 
 $11,000 
 
 $36,000 
 
 $62,000 
 
 $60,000 
 
 $5,000 
 
138 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Form II 
 Mortgages Classified by Interest Dates 
 
 Date 
 
 Total 
 
 Changes 
 
 JJ 
 
 FA 
 
 MS 
 
 AG 
 
 MN 
 
 i -J. 
 
 JD 
 
 1914 
 
 Jan.O 
 
 $169,000 
 7,000 
 
 262- 
 984 + 
 
 $23,000 
 
 $30,000 
 12,000 
 
 $4,000 
 
 $8,000 
 
 $90,000 
 
 $14,000 
 7,000 
 
 
 $162,000 
 12,000 
 
 
 Feb.O 
 
 $174,000, 
 
 $23,000 
 
 $42,000 
 
 $4,000 
 
 $8,000 
 
 $90,000 
 
 $ 7,000 
 
 The numbers in the column headed "Changes" are the 
 serial numbers of the respective mortgages. 
 
 § 184. Equal Instalment Method 
 
 Mortgages payable in equal instalments, each covering 
 the interest and part of the principal, present no special 
 difficulty. The value of the periodical instalment should 
 first be ascertained, as shown in § 76 ; then it should be 
 separated by means of a schedule into "Interest on Balances" 
 and "Payments on Principal," down to the final payment. 
 
CHAPTER XV 
 LOANS ON COLLATERAL 
 
 § 185. Short Time Loans on Personal Property 
 
 Short time investments are often made upon the security 
 or pledge of bonds, stocks, goods, or other personal property 
 valued at more than the amount of the loan. Frequently 
 these are payable on demand, and are known as "call loans." 
 It is evident that the rate of interest may be readjusted 
 every day, or as often as either party is dissatisfied, and, 
 if an agreement cannot be reached, the loan will be paid 
 off. Hence, neither premium nor discount will occur in this 
 kind of investment, and, as in the case of mortgages, we 
 need only concern ourselves with principal (at par) and 
 interest. 
 
 § 186. Forms for Loan Accounts 
 
 The accountancy of loans is even simpler than that of 
 mortgages, and it is only necessary to give two forms, one 
 for Principal account and Interest account, and the other for 
 the ''Register of Collateral" (§ 188). The latter account, at 
 least, is often kept on cards or on envelopes, and there is 
 great danger of the history becoming confused and unin- 
 telligible through erasures and changes in the amounts of 
 collateral, when substitutions are made. When part of a 
 certain security is withdrawn, the' entire line should be 
 ruled out, and the reduced quantity rewritten on a new line. 
 When a card becomes at all complicated, it is better to insert 
 a fresh one, rewriting all collateral, but keeping the former 
 card with the new one until the loan is entirely liquidated. 
 
 139 
 
I40 THE MATHEMATICS OF INVESTMENT 
 
 § 187. Requirements for Interest Account 
 
 The Interest account may be kept concurrent with the 
 Principal account — that is, using up the same number of 
 lines in each. In the suggested form there is a column for 
 interest accrued as well as for interest due. The interest 
 accrued column is merely a preparatory calculation column, 
 entered up at each change of rate or principal, so that there 
 may be only one computation to make when the interest 
 becomes due. With this exception, the mechanism of the 
 loan ledger is practically the same as that of the mortgage 
 ledger, and the general ledger account of loans will be 
 similar to that of mortgages. 
 
 As the principal and the interest in bond accounts are 
 so intimately connected, it will be advisable to consider the 
 accounting of interest revenue more fully before taking 
 up the subject of bond accounts. This is done in the follow- 
 ing chapter. 
 
 § 188. Forms for Collateral Loan Accounts 
 
 On the following page are shown two suggested forms 
 for use in connection with the records for collateral loans. 
 These forms are merely suggestive, and in this respect are 
 like other forms presented in the various chapters on book- 
 keeping records. Very few banks or trust companies handle 
 their accounts in exactly the same way, and changes and 
 additions will therefore be necessary or advisable in making 
 use of the forms suggested, in order to meet the particular 
 requirements of individual companies : 
 
LOANS ON COLLATERAL 
 
 141 
 
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 Collateral Security 
 
 
 
 
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CHAPTER XVI 
 
 INTEREST ACCOUNTS 
 
 § 189. Functions of the Three Interest Accounts 
 
 Interest is earned and accrues every day; then, at con- 
 venient periods, it matures and becomes collectible; then or 
 thereafter it is collected and takes the form of cash. These 
 three stages may be represented by the bookkeeping 
 formulas : 
 
 (1) Interest Accrued / Interest Revenue 
 
 (2) Interest Due / Interest Accrued 
 
 (3) Cash / Interest Due 
 
 Frequently the three accounts, Interest Revenue, Interest 
 Accrued, and Interest Due, are confused under the one title 
 "Interest," although they have three distinct functions. In- 
 terest Revenue (which alone may be termed simply "Inter—, 
 est") shows how much interest has been earned during the 
 current fiscal period. The balance of Interest Accrued shows 
 how much of those earnings and of the earnings in previous 
 periods has not yet fallen due. The balance of Interest Due 
 shows how much of that which has fallen due remains 
 uncollected. 
 
 The first of the three entries is the only one which imports 
 a modification in the wealth of the proprietor; the other 
 two are merely permutative, representing a shifting from 
 one kind of asset to another. It is not the mere collecting 
 of interest which increases wealth; nor is it merely the 
 coming-due of the interest : it is the earning of it from day 
 to day. 
 
 142 
 
INTEREST ACCOUNTS 143 
 
 § 190. A Double Record for Interest Earned 
 
 Interest accrued need not, and cannot conveniently, be 
 computed on each unit of investment, as we have already 
 stated. But it can readily be computed on all investments 
 of the same kind and rate of interest, and the aggregate 
 (say for a month) will form the basis for the entry ''Interest 
 Accrued / Interest Revenue." Or a daily rate for the entire 
 investment may be established, and this may be used without 
 change, day after day, until some change in the principal 
 or in the rate causes a variation in the daily increment. The 
 most complete and accurate method is to keep a double 
 register of interest earned : first, by daily additions ; second, 
 by monthly aggregates, classified under rates and time. 
 
 § 191. Example of Interest Income 
 
 To illustrate this, we will take a period of ten days 
 instead of a month, and assume that the investments are in 
 mortgages only. On the first day of the period there is 
 $100,000 running at 4%, $60,000 at 41/2%, and $150,000 
 at 5%. On the second day, $10,000 at 4% is paid off, and 
 on the fifth day $5,000 at 5%. On the seventh day a loan 
 of $15,000 is made at 41/2%, and one of $6,000 at 5%. We 
 begin by computing the daily increment, as follows : 
 
 One day at 4% on $100,000 $11.1111 
 
 One day at 41/2% on $ 60,000 7.50 
 
 One day at 5% on $150,000 20.8333 
 
 Total daily increment $39.4444 
 
 § 192. Daily Register of Interest Accruing 
 
 The decimals are carried out two places beyond the 
 cents, and rounded only in the total. The daily register will 
 then be conducted as follows : 
 
144 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Daily Register of Interest Accruing 
 For the month of , 1914 
 
 Date 
 
 No. 
 
 of 
 
 Loan 
 
 Decrease in 
 Principal 
 
 Increase in 
 Principal 
 
 Rate 
 
 Working 
 Column 
 
 Daily 
 Increment 
 
 1 
 2 
 
 3 
 
 4 
 5 
 
 6 
 
 7 
 
 8 
 
 9 
 
 10 
 
 647 
 
 453 
 
 981 
 
 982 
 
 $10,000 
 5,000 
 
 $ 15,000 
 6,000 
 
 4 
 
 5 
 
 4^ 
 5 
 
 $39.4444 
 1.1111 
 
 $ 39.4444 
 39.4444 
 
 38.3333 
 38.3333 
 38.3333 
 
 37.6388 
 37.6388 
 
 40.3472 
 40.3472 
 40.3472 
 
 $38.3333 
 .6944 
 
 $37.6388 
 1.875 
 .8333 
 
 
 
 
 $15,000 
 
 $ 21,000 
 
 
 
 $390.21 
 
 
 
 
 Balances 
 
 at Close 
 
 $ 90,000 
 
 75,000 
 
 151,000 
 
 4 
 
 4H 
 
 5 
 
 Proof 
 of Rate 
 One day 
 
 $ 10. 
 9.375 
 20.9722 
 
 
 $316,000 
 
 
 $ 40.3472 
 
 > 
 
 
 
 
 § 193. Monthly Summary 
 
 The monthly register or summary takes up, first, the 
 mortgages upon which payments are made, then those re- 
 maining to the end of the month, whether old or new. Its 
 result will corroborate that of the daily register. 
 
 The monthly register or summary of interest accruing 
 may be kept in the following form. As the loans are paid 
 off, the interest accrued is entered up in the last column. 
 New loans negotiated, or increases in principal, are entered 
 in column four, and the interest accruing to date of pay- 
 ment is carried to the last column in a similar manner. 
 
INTEREST ACCOUNTS 
 
 Monthly Summary of Interest Accruing 
 For the month of , 1914 
 
 145 
 
 Date 
 
 No. 
 of Loan 
 
 PakioflE 
 
 Remaining 
 
 Rate 
 
 Days 
 
 Monthly 
 Increment 
 
 2 
 
 5 
 
 7 
 « 
 
 10 
 <• 
 «« 
 
 647 
 453 
 
 981 
 982 
 
 $10,000 
 5,000 
 
 $ 15,000 
 
 6,000 
 
 90,000 
 
 60,000 
 
 145,000 
 
 4 
 
 5 
 
 4J^ 
 
 5 
 
 4 
 
 5 
 
 2 
 
 5 
 
 3 
 
 3 
 
 10 
 
 10 
 
 10 
 
 $ 2.2222 
 3.4722 
 5.625 
 2.50 
 100.00 
 75.00 
 201.3888 
 
 
 $316,000 
 
 
 
 $390.21 
 
 
 
 § 194. Method and Importance of Interest Earned Account 
 
 The daily and monthly registers of interest earned may 
 be in separate books or in one book — ^preferably the latter 
 in most cases. A convenient arrangement would be to use 
 two confronting pages for a month, one and one-half pages 
 for the daily register, and one-half page for the monthly 
 register. If an accurate daily statement of affairs is kept, 
 the daily interest accrued will form part of that system. 
 Again, the interest on mortgages, on bonds, on loans, or on 
 discounts may be separated or be all thrown together. In 
 all such respects the individual circumstances must govern, 
 and no precise forms can be prescribed. Our main conten- 
 tion is that in some manner interest should be accounted for 
 when earned rather than when collected, or when due. 
 
 § 195. Interest Accounts in General Ledger 
 
 The general ledger accounts of Interest, Interest Ac- 
 crued, and Interest Due will now be illustrated in simple 
 form as to mortgages only. It is easier to combine the 
 several kinds of interest, when carrying them to the Profit 
 and Loss account, than to separate them if they are all 
 thrown in together at first. 
 
146 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Form I — Interest Revenue 
 Mortgages 
 
 1914 
 June 30 
 
 Carried to Profit 
 and Loss 
 
 $4270 
 
 60 
 60 
 
 $4270 
 
 
 — II 
 
 1914 
 Jan. 
 Feb. 
 March 
 April 
 May 
 June 
 
 1-31 
 1-28 
 1-31 
 1-30 
 1-31 
 1-30 
 
 Total Earnings 
 
 $ 654 
 708 
 723 
 756 
 719 
 708 
 
 $4270 
 
 Form II — Interest Accrued 
 Mortgages 
 
 1914 
 
 
 
 
 1914 
 
 
 
 
 Jan. 
 
 
 
 Balance 
 
 $2362 
 
 50 
 
 
 
 
 
 
 1-31 
 
 Earnings 
 
 654 
 
 58 
 
 Jan. 1-31 
 
 Due 
 
 $1272 
 
 50 
 
 Feb. 
 
 1-28 
 
 " 
 
 708 
 
 25 
 
 Feb. 1-28 
 
 " 
 
 125 
 
 00 
 
 March 
 
 17 
 
 Cash for Accrued 
 on No. 987 
 
 58 
 
 33 
 
 
 
 
 
 
 1-31 
 
 Earnings 
 
 723 
 
 34 
 
 March 1-31 
 
 " 
 
 875 
 
 00 
 
 April 
 
 1-30 
 
 " 
 
 756 
 
 67 
 
 April 1-30 
 
 " 
 
 625 
 
 00 
 
 May 
 
 1-31 
 
 " 
 
 719 
 
 44 
 
 May 1-31 
 
 
 1200 
 
 00 
 
 June 
 
 1-30 
 
 " 
 
 708 
 
 33 
 
 June 1-30 
 
 " 
 
 65 
 
 00 
 
 
 
 
 Balance 
 
 
 44 
 
 30 
 
 Balance 
 
 2528 
 
 94 
 
 
 $6691 
 
 $6691 
 
 44 
 
 July 
 
 $2528 
 
 94 
 
 
 
 Form III — Interest Due 
 Mortgages 
 
 1914 
 
 
 
 
 1914 
 
 
 
 
 Jan. 
 
 Balance 
 
 $ 125 
 
 00 
 
 
 
 
 
 1-31 
 
 Due 
 
 1272 
 
 50 
 
 Jan. 1-31 
 
 Collections 
 
 $1325 
 
 00 
 
 Feb. 1-28 
 
 " 
 
 125 
 
 00 
 
 Feb. 1-28 
 
 
 197 
 
 50 
 
 March 1-31 
 
 « 
 
 875 
 
 00 
 
 March 1-31 
 
 
 850 
 
 00 
 
 April 1-30 
 
 " 
 
 625 
 
 00 
 
 April 1-30 
 
 
 600 
 
 00 
 
 May 1-31 
 
 « 
 
 1200 
 
 00 
 
 May 1-31 
 
 
 1200 
 
 00 
 
 June 1-30 
 
 It 
 
 65 
 
 00 
 
 June 1-30 
 
 
 100 
 
 00 
 
 
 Balance 
 
 
 50 
 
 30 
 
 Balance 
 
 15 
 
 00 
 
 
 $4287 
 
 $4287 
 
 50 
 
 July 
 
 $ 15 Ool 
 
 
 
INTEREST ACCOUNTS 
 
 147 
 
 § 196. Payment of Accrued Interest 
 
 There is one entry in Interest Accrued account which 
 does not arise from earnings : the accrued interest on Mort- 
 gage No. 987, which is paid for in cash on March 17, the 
 mortgage not having been made direct with the mortgagor, 
 but purchased from a previous holder. This case occurs 
 frequently in bond accounts, but not so often in connection 
 with mortgages. 
 
CHAPTER XVII 
 
 BONDS AND SIMILAR SECURITIES 
 
 § 197. Investments with Fluctuating Values 
 
 The investments heretofore considered are interest bear- 
 ing, but bear no premium nor discount ; the variation from 
 time to time is in the rate of interest, while the principal is 
 invariable. When we consider investments whose price fluc- 
 tuates, while the cash rate of interest is constant, the problem 
 is more difficult, because there are several prices which it 
 may be desired to record, viz., the original cost, the market 
 value, the par, and the book value or amortized value. The 
 original cost and the par are the extremes : one at the be- 
 ginning, and one at the end of the investment. The book 
 values are intermediate between these, and represent the 
 investment value, falling or rising to par by a regular law, 
 which maintains the net income at a constant rate. The 
 market value is not an investment value, but a commercial 
 one ; it is the price at which the investor could withdraw his 
 investment, but until he has done so, he has not profited by 
 its rise, nor lost by its fall. So long as he retains his 
 investment, the market value does not affect him, nor should 
 it enter into his accounts. It is valuable information, how- 
 ever, from time to time, if he has the privilege of changing 
 mvestments, or the necessity of realizing. 
 
 § 198. Amortization Account 
 
 The account with principal, showing at each half-year 
 the result of amortization, is very suitably kept in the three- 
 
 148 
 
BONDS AND SIMILAR SECURITIES 
 
 149 
 
 column or balance-column form recommended in § 169 for 
 mortgages. Thus, the history of the bonds in Schedule (F), 
 § 139, would be thus recorded in ledger form : 
 
 $100,000 Smithtown 5's of May 1, 19 
 
 19 
 
 Date 
 
 
 Dr. 
 
 Cr. 
 
 Balance 
 
 1914 May 1 
 Nov. 1 
 
 1915 May 1 
 Nov. 1 
 
 1916 May 1 
 
 Purchased from A. B. & Co. 
 Amortization (4%) 
 
 $104,500 
 
 $410.97 
 419.19 
 427.57 
 436.12 
 
 $104,089.03 
 103,669.84 
 103,212.27 
 102,806.15 
 
 § 199. Effect on Schedule of Additional Purchases 
 
 In case of an additional purchase the account will, of 
 course, be debited and cash credited. It will then be neces- 
 sary to reconstruct the schedule from that point on. This 
 may be done in either of two ways: (1) make an indepen- 
 dent schedule of the new purchase, and then consolidate this 
 with the old one, adding the terms; or (2) add together the 
 values of the old and new bonds at the next balance date; 
 find what the basis of the total is, eliminate any slight resi- 
 due (§§137 to 140, inclusive), and proceed with the 
 calculation.* 
 
 § 200. The Bond Sales Account 
 
 In case of a sale, the procedure is different. Instead of 
 crediting the Bond account by cash, it is best to transfer the 
 amount sold to a Bond Sales account at its book value com- 
 puted down to the day of sale ; Bond Sales account will then 
 show a debit, and the cash proceeds will be credited to the 
 same account. The resultant will show a gain or loss on the 
 sale, and at the balancing date the account will be closed into 
 
 * Bonds purchased flat should be separated into principal and interest. 
 
I50 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Profit and Loss. Thus, in the example in § 198, we will 
 suppose a sale on August 1, 1916, of half the $100,000 at 
 102.88, or $51,440. We find the book value of the $50,000 
 on August 1, which is $51,291.86; we transfer this to the 
 debit of the Bond Sales account in the general ledger, which 
 account we credit with the $51,440 cash proceeds. Bond 
 Sales is purely a Profit and Loss account, and at the proper 
 time will show the actual profit realized on the sale, $51,440 
 — $51,29L86 = $148.14. 
 
 Form I — Bond Ledger 
 $100,000 Smithtown 5's of May 1, 1919 
 
 Date 
 
 
 Dr. 
 
 Cr. 
 
 Balance 
 
 1914 May 1 
 
 Purchased from A. B. & Co. 
 
 $104,500 
 
 
 
 Nov. 1 
 
 Amortization 
 
 
 $ 410.97 
 
 $104,089.03 
 
 1915 May 1 
 
 «« 
 
 
 419.19 
 
 103,669.84 
 
 Nov. 1 
 
 " 
 
 
 427.57 
 
 103,242.27 
 
 1916 May 1 
 
 " 
 
 
 436.12 
 
 102,806.15 
 
 Aug. 1 
 
 Sale to C. D. & Co. 
 
 
 
 
 
 $50,000 @ 102.88 
 
 
 51,291.86 
 
 51,514.29 
 
 « 
 
 Amortization on $50,000 
 
 
 111.21 
 
 51,403.08 
 
 Nov. 1 
 
 " on balance 
 
 
 222.43 
 
 51,180.65 
 
 Form II — General Ledger 
 Bond Sales 
 
 1914 
 Aug. 1 
 
 Smithtown 5's 
 
 $51,291.86 
 
 1914 
 Aug 1 
 
 Proceeds 
 
 $51,440.00 
 
 To adjust the profit in the Bond account itself would be 
 as unphilosophical as the old-fashioned Merchandise account 
 before the Purchases and Sales accounts were introduced, 
 and even more awkward. 
 
BONDS AND SIMILAR SECURITIES 
 
 151 
 
 § 201. Requirements as to Bond Records 
 
 Besides the book value of a bond, the par is also needed 
 because the cash interest is reckoned upon the par. For 
 some purposes, also, it is useful to show the original cost. 
 We must, therefore, provide means for exhibiting these three 
 values: the par, the original cost, and the book value. A 
 mere memorandum of par and cost at the top would be 
 sufficient where the group of bonds in question will all be 
 held to the same date; but this is not always the case, and 
 provision must be made for increase and decrease. The 
 three-column form of ledger (§169), constantly exhibiting 
 the balance, is the most suitable for this purpose also. But 
 if we endeavor to display all of these forms side by side, we 
 require nine columns, and this makes an unwieldy book. 
 The most practical way is to abandon the use of debit and 
 credit columns, and proceed by addition and subtraction, or 
 in what the Italians term the scalar (ladder-like) form, 
 which gives a perfectly clear result, especially if the balances 
 are all written in red. Headed by a description of the bonds, 
 and embracing, also, a place for noting the market value at 
 intervals (not as matter of account, but of information), the 
 Principal account will appear as shown in Form I (page 
 152). 
 
 § 202. Form of Bond Ledger 
 
 As far as the bond ledger is concerned, the transfer of 
 the $50,000 sold to Sales account is final ; we have, however, 
 in the example indicated (§ 200), a way of incorporating a 
 statement of the profit or loss in the margin for historical 
 purposes. The amortization of November 1, 1916, is com- 
 posed of two parts : 3 months on the $50,000 sold, $111.21; 
 and the regular 6 months on the $50,000 retained, $222.43. 
 In the example given in § 200, these are entered separately; 
 either method may be pursued, but on the whole there are 
 greater advantages in postponing all entries of amortization 
 
152 
 
 THE MATHEMATICS OF INVESTMENT 
 
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BONDS AND SIMILAR SECURITIES 
 
 153 
 
 till the end of the half-year. The three months' amortiza- 
 tion of the bonds sold is in effect implied in the price $51,- 
 291.86, which is reduced by the amortization ($111.21) 
 from $51,403.07, the half of $102,806.15, but it need not 
 be entered till November 1. 
 
 § 203. Interest Due Account 
 
 The register of interest due on bonds is conducted on 
 precisely the same principles as that described for mortgages 
 in § 183 ; in fact, they are but subdivisions of the same 
 register. Of course, only the cash interest is considered. 
 
 §204. Interest Account — Bond Ledger 
 
 The interest pages of the bond ledger are also similar to 
 those of the mortgage ledger (§ 183), but the dates of in- 
 terest due may be printed in advance, there being but little 
 chance of partial payments disturbing their orderly ar- 
 rangement. 
 
 The paging of the bond ledger will probably be geo- 
 graphical, as far as possible, in respect of public issues, and 
 alphabetical in respect of those of private corporations. The 
 loose-leaf plan permits an indefinite number of classifica- 
 tions from which to choose. The date tags suggested in 
 § 178 are especially useful for pointing out dates for interest 
 falling due, as "J J," "F A," etc. 
 
 § 205. Amortization Entries 
 
 The entries of amortization are made directly from the 
 schedules of amortization, the preparation of which was 
 discussed in Chapter X. But it is necessary, also, to make 
 up a list of these several amortizations in order to form the 
 general ledger entry : 
 
 Amortization / Bonds 
 or. Amortization / Premiums 
 
154 
 
 THE MATHEMATICS OF INVESTMENT 
 
 according to the form of the general ledger. This list 
 should be in the same order as the bond ledger. Probably 
 the most practical way is to combine it with the trial balance 
 of the bond ledger, thus giving at each fiscal period a com- 
 plete list of the holdings, which may give the par, cost, book, 
 and market values, the titles of the securities being written 
 but once. The total of the second column will form the basis 
 of the entry for amortization. The next three columns will 
 corroborate the general ledger balances. 
 
 Bond Statement for the Half- Year Ending 
 
 Name and 
 Description 
 
 Amorti- 
 zation 
 
 Book Value 
 
 Par Value 
 
 Original 
 Cost 
 
 Market 
 Value 
 
 In the cases of bonds bought at a discount, the analogous 
 general ledger entry would be : 
 
 Bonds / Accumulation 
 or. Discounts / Accumulation 
 
 We have provided in the preceding form for amortization 
 only and not for accumulation on bonds below par. Where 
 the latter values are few in number they may be embraced 
 in the same column, but distinguished as negatives by being 
 written in red or encircled. If the bonds below par are 
 numerous, there should be two columns : * 'amortization" and 
 "accumulation." 
 
 § 206. Bond Entries in General Ledger 
 
 While the book value is the proper one to be introduced 
 
BONDS AND SIMILAR SECURITIES 155 
 
 into the general ledger, the par is very necessary, and some- 
 times the cost, and these requirements inevitably introduce 
 some complexity. There are two methods effecting the 
 purpose : 
 
 (1) By considering the par and cost as extraneous in- 
 
 formation, and ruling side columns for them 
 beside the book value. 
 
 (2) By dividing the account into several accounts, by 
 
 the proper combination of which the several 
 values may be obtained. 
 
 The first plan will preserve the conformity of the Bonds 
 account with the bond ledger better than the other. The 
 Bonds account may, if necessary, be extended across both 
 pages of the ledger, to allow for three debit and three credit 
 columns, if all are required. 
 
 The second method will commend itself more to those 
 having a repugnance to introducing into the general ledger 
 any figures beyond those actually forming part of the trial 
 balance. The theory on which it is based is that the premium 
 is not part of the bond, but is a sum paid in advance for 
 excess interest, while the discount is a rebate returned to 
 make good deficient interest. This is a perfectly admissible 
 way of looking at the matter, especially from the personalis- 
 tic point of view; for the debtor does not owe us the 
 premium and has nothing to do with it. Still the other view, 
 which regards the investment as a whole, is also correct, 
 and wx may adopt whichever is most suitable to our purpose. 
 
 § 207. Accounts Where Original Cost Is Disregarded 
 
 If original cost is disregarded, or deemed easily obtain- 
 able when required, the accounts may be : 
 
156 THE MATHEMATICS OF INVESTMENT 
 
 (a) Bonds at Par 
 
 (b) Premiums 
 
 (c) Discounts 
 
 or, 
 
 (a) Bonds at Par 
 
 (b) Premiums and Discounts 
 
 If premiums and discounts are kept separate, Premiums 
 account must always show a debit balance, being credited 
 for amortization; Discounts account must show a credit 
 balance, being debited for accumulation. If the two are 
 consolidated, only the net amortization will be credited 
 (§ 205) ; or if the greater part of the bonds were below par, 
 the net accumulation only would be debited. The choice be- 
 tween one account and two for premiums and discounts is 
 largely a question of convenience. 
 
 The management of such a double or triple account is 
 obvious, entries of transactions being divided between par 
 and premiums, or par and discounts, but we give in § 214 an 
 example of each. 
 
 We shall hereafter confine the discussion to premiums, 
 leaving the cases of discount to be determined by analogy. 
 
 § 208. Amortization Reserve 
 
 Where it is deemed necessary to keep account of cost 
 also, as well as of par and book value, the difficulty is some- 
 what greater, as we have a valueless or extinct quantity to 
 record, namely, so much of the original premium on bonds 
 still held as has not yet been absorbed in the process of 
 amortization. This carrying of a dead value, which is some- 
 what artificial, necessitates the carrying, also, of an artificial 
 annulling or offsetting account, the sole function of which 
 is to express this departed value. We may call this credit 
 
BONDS AND SIMILAR SECURITIES 
 
 157 
 
 account "Reserve for Amortization." It is analogous to 
 Depreciation and Reserve for Depreciation. The part of the 
 premiums which has been extinguished bytcredits to Reserve 
 for Amortization may be designated as "Premiums Amor- 
 tized," or "Ineffective Premiums," while the live premiums 
 may be styled "Effective Premiums," being what in § 207 
 we called simply "Premiums." A double operation takes 
 place in these accounts : first, the absorption of effective 
 premiums by lapse of time; and second, the cancellation of 
 ineffective premiums upon redemption or sale. 
 
 § 209. Premiums and Amortization 
 
 There are two ways of handling these accounts, differ- 
 ing as to premiums. We may keep two accounts : "Effec- 
 tive Premiums" and "Amortized Premiums," or we may 
 combine these in one, "Premiums, at Cost." The entire 
 scheme will be : 
 
 (a) Bonds at Par 
 
 (b) Premiums at Cost 
 
 (e) Reserve for. Amortization 
 
 or, 
 
 (a) Bonds at Par 
 
 (c) Effective Premiums 
 
 (d) Amortized Premiums 
 
 (e) Reserve for Amortization 
 
 "a" will in both schemes be the same ; "e" will also be the 
 same, "b" is the sum of "c" and "d." In the former, the 
 cost is a + b, while the book value is a + b — e. In the latter 
 the book value is a + c, while the cost is a + c + d. The 
 former gives the cost more readily than the latter, and the 
 book value less readily. The former might be considered the 
 more suitable for a trustee; the latter, for an investor. 
 
158 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Account (a), Bonds at Par, is debited for par value of 
 purchases and credited for par value of sales. Its only two 
 entries are : 
 
 Bonds at Par / Cash (or some other asset) 
 Cash (or some other asset) / Bonds at Par 
 
 In case of purchase at a premium, the premium is 
 charged to Premiums at Cost or to Effective Premiums, as 
 the case may be, there being no ineffective premiums at this 
 time. 
 
 § 210. Writing Off Premiums 
 
 When premiums are written off, on the first plan illus- 
 trated in § 209 there is but one entry : crediting Reserve for 
 Amortization and debiting the Profit and Loss account or 
 its subdivision. 
 
 Amortization / Reserve for Amortization 
 
 The second plan involves not only this process, but a 
 transfer from Effective to Amortized Premiums. Thus, the 
 aggregate of premiums written off is posted four times as a 
 consequence of the separation of premiums at cost into two 
 accounts: if 
 
 Premiums Amortized / Effective Premiums 
 Amortization / Reserve for Amortization 
 
 § 211. Disposal of Amortization 
 
 The word "Amortization" has been used in the illustra- 
 tive entries as the title of an account tributary to Profit and 
 Loss. At the balancing period it may be disposed of in 
 either of two ways : It may be closed into Profit and Loss 
 direct ; or it may be closed into Interest account, the balance 
 of which will enter into Profit and Loss at so much les- 
 
•BONDS AND SIMILAR SECURITIES icq 
 
 sened a figure. By the former method the Profit and Loss 
 account will show, on the credit side, the gross cash inter- 
 est, and on the debit side the amount devoted to amortiza- 
 tion ; the second method exhibits only the net income from 
 interest on bonds. Whether it be preferable to show both 
 elements, or only the net resultant, will be determined by 
 expediency. 
 
 § 212. Amortization Accounting — Comparison of Methods 
 
 In §§ 200 and 202 we discussed two methods of keeping 
 account of amortization: the first (in §200), where any 
 incidental amortization occurring in the midst of the period 
 is at once entered; the second (in §202), where all such 
 entries are deferred to the end of the period., and comprised 
 in one entry in the general ledger. If the latter method be 
 adopted, the Amortization account may be dispensed with 
 altogether, and the total amount amortized (which is 
 credited to Bonds, or to Premiums, or to Reserve for 
 Amortization) may be debited at once to Profit and Loss or 
 to Interest, without resting in a special account. A single 
 item, of course, needs no machinery for grouping. 
 
 § 213. Irredeemable Bonds a Perpetual Ai^nuity 
 
 Irredeemable bonds (§ 146) merely lack the element of 
 amortization, and require no special arrangement of ac- 
 counts. The par is purely ideal, as it never can be demanded 
 and is merely a basis for expressing the interest paid. What 
 the investor buys is a perpetual annuity. If he buys an 
 annuity of $6 per annum, it is unimportant whether it is 
 called 6% on $100 principal, or 4% on $150 principal; and 
 this $150 may be the par value, or it may b.e $100 par at 
 50% premium, or $200 par at 25% discount. The par value 
 is really non-existent. 
 
l6o THE MATHEMATICS OF INVESTMENT 
 
 § 214. Bond Accounts for General Ledger 
 
 In the present section are shown the forms for the gen- 
 eral ledger outlined in §§ 206-212. We will suppose that 
 on January 1, 1915, the following lots of bonds are held : 
 
 January 1, 1915 
 Par Book Value 
 
 $100,000 5% Bonds, J J, 
 
 due Jan. 1, 1925, net 2.7% ; value. .$120,039.00 
 Original cost, $124,263.25 
 100,000 3% Bonds, M N, 
 
 due May 1, 1918, net 4%; value. . 96,909.10 
 Original cost, $93,644.28 
 10,000 4% Bonds, A O, 
 
 due Oct. 1, 1916, net 3%; value.. 10,169.19 
 Original cost, $10,250.00 
 
 $210,000 Totals $227,117.29 
 
 The premiums on the 5% and 4% bonds amount to 
 $20,208.19. The discount on the 3% bonds is $3,090.90. 
 The net premium is $17,117.29. The total original cost 
 was $228,157.53. 
 
BONDS AND SIMILAR SECURITIES 
 
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l62 THE MATHEMATICS OF INVESTMENT 
 
 Bond Accounts for General Ledger — Plan II (§ 207) 
 Dr. Bonds at Par Cr. 
 
 1915 
 Jan. 0, 
 
 Balance $210,000.00 
 
 1916 
 Oct. L 
 
 Redeemed. $10,000.00 
 
 Dr. 
 
 Premiums 
 
 
 Cr. 
 
 1915 
 
 
 1915 
 
 
 
 Jan. 0, 
 
 Balance $20,208.19 
 
 June 30, 
 
 Amortization. 
 
 ..$926.94 
 
 
 
 Dec. 31, 
 
 « 
 
 .. 939.54 
 
 
 
 1916 
 
 
 
 
 
 June 30, 
 
 (( 
 
 .. 952.28 
 
 
 
 Dec. 31, 
 
 i( 
 
 .. 940.21 
 
 
 
 1917 
 
 
 
 
 
 June 30, 
 
 u 
 
 ... 927.93 
 
 
 
 Dec. 31, 
 
 it 
 
 .. 940.47 
 
 Dr. 
 
 
 Discounts 
 
 Cr. 
 
 1915 
 
 
 
 1915 
 
 
 June 30, 
 
 Accumulation.. . 
 
 .$438.18 
 
 Jan. 0, 
 
 Balance $3,090.90 
 
 Dec. 31, 
 
 « 
 
 . 446.95 
 
 
 
 1916 
 
 
 
 
 
 June 30, 
 
 « 
 
 . 455.88 
 
 
 
 Dec. 31, 
 
 it 
 
 . 465.00 
 
 
 
 1917 
 
 
 
 i 
 
 
 June 30. 
 
 « 
 
 . 474.30 
 
 1 
 
 
 Dec. 31. 
 
 « 
 
 . 483.79 
 
 1 
 
 
BONDS AND SIMILAR SECURITIES 
 
 163 
 
 Bond Accounts for General Ledger — Plan III (§ 207) 
 (Original cost omitted) 
 
 Dr. 
 
 Bonds at Par 
 
 Cr, 
 
 1915 
 Jan. 0, 
 
 Balance $210,000.00 
 
 1916 
 Oct. 1 
 
 Redeemed $10,000.00 
 
 Dr. 
 
 Premiums and Discounts 
 
 Cr. 
 
 1915 
 Jan. 0, 
 
 Balance $17,117.29 
 
 1915 
 June 30, 
 Dec. 31, 
 
 Amortization. 
 
 ..$488.76 
 .. 492.59 
 
 
 
 1916 
 June 30, 
 Dec. 31, 
 
 u 
 u 
 
 .. 496.40 
 .. 475.21 
 
 
 
 1917 
 June 30, 
 Dec. 31, 
 
 It 
 
 .. 453.63 
 ... 456.68 
 
 
 
 
 
 
164 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Bond Accounts for General Ledger — Plan IV (§ 209) 
 ("Bonds at Par" as in foregoing plans) 
 
 Dr. 
 
 Premiums at Cost 
 
 Cr. 
 
 1915 
 Jan. 0, 
 
 1918 
 Jan. 0, 
 
 Balance $18,157.53 
 
 Balance, 
 
 $18,157.53 
 .$17,907.53 
 
 1916 
 Oct. 1, 
 
 1917 
 Dec. 31, 
 
 Canceled at Re- 
 demption... .$ 250.00 
 
 Balance 17.907.53 
 
 $18,157.53 
 
 Dr. 
 
 Reserve for 
 
 Amortization Cr. 
 
 1916 
 
 
 1915 
 
 
 Oct. 1, 
 
 Canceled at Re- 
 
 Jan. 0. 
 
 Balance $1,040.24 
 
 
 demption.. . .$ 250.00 
 
 June 30, 
 
 Amortization. . . 488.76 
 
 
 
 Dec. 31, 
 
 ... 492.59 
 
 1917 
 
 
 
 
 Dec. 31, 
 
 Balance 3,653.51 
 
 1916 
 
 
 
 
 June 30, 
 
 ... 496.40 
 
 
 
 Dec. 31, 
 
 ... 475.21 
 
 
 
 1917 
 
 
 
 
 June 30, 
 
 ... 453.63 
 
 
 
 Dec. 31, 
 
 ... 456.68 
 
 
 $3,903.51 
 
 $3,903.51 
 
 
 
 1918 
 Jan. 0, 
 
 
 
 
 Balance $3,653.51 
 
BONDS AND SIMILAR SECURITIES 
 
 i6S 
 
 Bond Accounts for General Ledger — Plan V (§ 210) 
 (By the balance column method) 
 
 Bonds at Par 
 
 Dr. 
 
 Cr. Balance Dr. 
 
 1915 
 Jan. 
 
 1916 
 Oct. 1 
 
 Balance 
 
 Redemption. 
 
 $210,000.00 
 
 $10,000.00 
 
 $210,000.00 
 200,000.00 
 
 Effective Premiums 
 
 Dr, 
 
 Cr. Balance Dr. 
 
 1915 
 Jan. 
 June 30 
 Dec. 31 
 
 1916 
 June 30 
 Dec. 31 
 
 1917 
 June 30 
 Dec. 31 
 
 Balance 
 
 Amortized 
 
 $ 17,117.29 
 
 $ 488.76 
 492.59 
 
 496.40 
 475.21 
 
 453.63 
 456.68 
 
 $ 17,117.29 
 16,628.53 
 16,135.94 
 
 15,639.54 
 15,164.33 
 
 14,710.70 
 14,254.02 
 
 Ineffective or Amortized 
 Premiums 
 
 Dr. 
 
 Cr. Balance Dr. 
 
 1915 
 Jan. 
 June 30 
 Dec. 31 
 
 1916 
 June 30 
 Oct. 1 
 Dec. 31 
 
 1917 
 June 30 
 Dec. 31 
 
 Balance 
 
 Amortized 
 
 « 
 
 u 
 
 Canceled by Redemption 
 Amortized 
 
 $ 1,040.24 
 488.76 
 492.59 
 
 496.40 
 
 475.21 
 
 453.63 
 456.68 
 
 $ 250.00 
 
 1,040.24 
 1,529.00 
 2,021.59 
 
 2,517.99 
 2,267.99 
 2,743.20 
 
 3,196.83 
 3,653.51 
 
i66 
 
 THE MATHEMATICS OF INVESTMENT 
 
 Reserve for Amortization 
 
 Dr. 
 
 Cr. Balance Cr. 
 
 1915 
 Jan. 
 June 30 
 Dec. 31 
 
 1916 
 June 30 
 Oct. 1 
 Dec. 31 
 
 1917 
 June 30 
 Dec. 31 
 
 Balance 
 
 Amortized 
 
 (( 
 
 Canceled by Redemption 
 Amortized 
 
 $ 250.00 
 
 $ 1,040.24 
 488.76 
 492.59 
 
 496.40 
 475.21 
 
 453.63 
 456.68 
 
 1,040.24 
 1,529.00 
 2.021.59 
 
 2,517.99 
 2,267.99 
 2,743.20 
 
 3,196.83 
 3.653.51 
 
CHAPTER XVIII 
 
 DISCOUNTED VALUES 
 
 § 215. Securities Payable at Fixed Dates Without Interest 
 
 The securities heretofore considered have all carried a 
 stipulated rate of interest or annuity. There is another class 
 to which no periodical interest attaches, but the obligation is 
 simply to pay a single definite sum on a certain date. The 
 present vakie of that sum at the current or contractual rate 
 of income is, of course, obtained by discounting according 
 to the principles explained in Chapter XL If the maturity 
 were more than one year distant at the time of discount, it 
 would be necessary to compute the compound discount ; but 
 in practice this never occurs, such discounts being for a few 
 months. 
 
 The obligations discounted in this manner are almost 
 invariably promissory notes. Formerly they consisted large- 
 ly of bills of exchange; hence the survival in bookkeeping 
 of the words "Bills Receivable," "Bills Payable," and "Bills 
 Discounted." 
 
 These obligations belong rather to mercantile and bank- 
 ing accountancy than to investment accountancy. The 
 arrangement of accounts for recording their amounts, classi- 
 fication, and maturity has been so fully treated in works on 
 those branches that we refer to them here only for the 
 purpose of illustrating another phase of the process of secur- 
 ing income. 
 
 § 216. Rates of Interest and Discount 
 
 The difference between the rate of interest and the rate 
 
 167 
 
l68 THE MATHEMATICS OF INVESTMENT 
 
 of discount has been pointed out in Chapter II. It was 
 there shown that in a single period the rate of interest 3% 
 corresponds to the rate of discount .029126. Hence, if we 
 discount a note for $1.00 at 2.9126%, we acquire interest at 
 the rate of 3% on the $.970874 actually invested. The rate 
 of interest is always greater than the rate of discount. 
 
 § 217. Rate of Discount Named in Notes 
 
 It is usual to name a rate of discount rather than a rate 
 of interest in stipulating for the acquisition of notes. For 
 example, a three months' note for $1,000 is taken for dis- 
 count at 6% (per annum). This means that $.015 is to be 
 retained by the payee of the note from each dollar, and the 
 amount actually paid over is $985. The income from this 
 is the $15, and by dividing 15 by 985 we readily ascertain 
 that the rate of interest realized is 6.09%. It is sometimes 
 believed that there is a kind of deception in this; that the 
 borrower agrees to pay 6% and actually has to pay 6.09%. 
 But this is not so : the bargain is not to pay 6 % interest, but 
 to allow 6% discount, which is a different thing. 
 
 § 218. Form as Affecting Legality 
 
 Curiously, the lawfulness or unlawfulness of a trans- 
 action sometimes depends upon the mere form of words in 
 which it is expressed. Thus, suppose that A lends $985 to 
 B, who promises to repay $1,000 at the end of 3 months. If 
 B's promise reads : *T promise to pay $1,000," A is a law- 
 abiding citizen; but if B writes : "I promise to pay $985 and 
 interest at 6.09% per annum," the statute prohibiting usury 
 is violated. 
 
 § 219. Entry of Notes Discounted 
 
 Notes discounted are usually entered among the assets 
 at the full face, and the discount credited to an offsetting 
 
DISCOUNTED VALUES 
 
 169 
 
 account, "Discounts," the latter having precisely the same 
 effect as the Discounts account used in connection with 
 bonds. The difference of the two is the net amount of the 
 asset. Strictly speaking, the discount is at first an offset to 
 the note, and represents at that time nothing earned what- 
 ever; as time goes on, the earning is effected by diminution 
 of this offset, which is equivalent to a rise in the net value 
 of the note, from cost to par. In § 220 the process is shown 
 by the state of the accounts at the initial date and at the end 
 of each month up to maturity, for a 3 months' note for 
 $1,000, discounted at 6%. 
 
 § 220. Discount and Interest Entries 
 
 Note 
 
 $1000.00 
 
 (i) When Discounted 
 Discount 
 
 $15.00 
 
 (2) At the End of One Month 
 Note Discount Interest Revenue 
 
 $1000.00 
 
 $ 5.00 
 
 $15.00 
 
 $5.00 
 
 (3) At the End of Two Months 
 Note Discount Interest Revenue 
 
 $1000.00 
 
 $ 5.00 
 5.00 
 
 $15.00 
 
 $5.00 
 5.0U 
 
 Note 
 
 $1000.00 
 
 (4) At Maturity 
 
 Discount Interest Revenue 
 
 $ 5.00 
 5.00 
 5.00 
 
 $15.00 
 
 $15.00 
 
 $15.00 
 
 
 
 $5.00 
 5.00 
 5.00 
 
lyo THE MATHEMATICS OF INVESTMENT 
 
 § 221. Total Earnings from Discounts 
 
 Since notes are issued generally for short periods, the 
 gradual crediting of earnings illustrated in § 220 is usually 
 ignored. At the date when the books are closed, an inven- 
 tory should be taken of the discounts unearned. The differ- 
 ence between the amount of this inventory and the net credit 
 in the Discounts account represents the earning from dis- 
 counts during the fiscal period, and this earning should then 
 be transferred to Profit and Loss. The unearned discounts 
 may be easily computed by finding the discount on each 
 note from the date of closing the books to the respective 
 dates of maturity. The investment value of the notes on 
 hand at the close of the fiscal period will be the difference 
 between the par and the unearned discount. Expressed in 
 a formula, the earnings from discounts may be found as 
 follows : 
 
 Unearned discounts at beginning of fiscal period, 
 + discounts credited during period, 
 — unearned discounts at end of period, 
 = earnings from discounts during period. 
 
Part II — Problems and Studies 
 
 CHAPTER XIX 
 
 INTEREST AND DISCOUNT 
 
 § 222. Problems in Simple Interest* 
 
 (1) What is the time in months and days from January 
 10th to : 
 
 (a) June 12th? 
 
 (b) July 4th? 
 
 (c) September 1st? 
 
 (2) What date is: 
 
 (a) Two months after June 30th ? 
 
 (b) Four months after May 31st? 
 
 (c) Two months after December 31st? 
 
 (d) Five months and seven days after September 
 
 26th? 
 
 (3) On a loan of $54,750, interest payable semi-annually 
 at 4% per annum, interest was last paid to and including No- 
 vember 1 : compute the interest accrued on the following 
 February 25th : 
 
 (a) In the customary manner, legal in New York 
 
 before 1892. 
 
 (b) Assuming that the odd days are 365ths of a 
 
 year. 
 
 • In connection with the text of Chapter II. For answers see § 224. 
 
 171 
 
172 
 
 PROBLEMS AND STUDIES 
 
 (c) Compute the same by both methods at 4%%. 
 
 (d) " " " " " " " 5%. 
 
 (e) " " " " " " " 6%. 
 
 (4) On a 365-day basis, the interest for 17 days, on a 
 certain sum, at a certain rate, was $83.73 ; what would have 
 been the interest on a 360-day basis ? 
 
 (5) The interest for 19 days on a certain sum at a 
 certain rate was $2,185.00 on a 360-day basis; compute 
 the interest on a 365-day basis. 
 
 § 223. Notes on the One Per Cent Method 
 
 Observe that when days are considered as 360ths of a 
 year, it is useful to know how many days correspond to one 
 per cent. For example, if the rate is 3%, it takes 120 in- 
 terest days to earn 1% interest. 
 
 At 3 % the number of days for 1% is 120 
 
 At 4 % 
 
 
 
 
 (( (( 
 
 " 90 
 
 At 41/2% 
 
 
 
 
 ({ (f 
 
 " 80 
 
 At 5 % 
 
 
 
 
 (t (( 
 
 " 72 
 
 At 6 % 
 
 
 
 
 (( (t 
 
 " 60 
 
 At 8 % 
 
 
 
 
 (t (( 
 
 " 45 
 
 At 9 % 
 
 
 
 
 (( t( 
 
 " 40 
 
 For purposes of calculation we may set down the num- 
 ber of days corresponding to 1% at the given rate, and in 
 line with it the principal, pointing off two places from the 
 right in the principal in order to obtain 1%. Thus, in 
 Problem (3) of the preceding section : 
 90 days $547.50 
 meaning that the interest for 90 days at 4% is $547.50. 
 Knowing the interest for 90 days, we can build up that for 
 114 days (3 months and 24 days on the 360-day basis). 
 24 days = 15 days + 9 days. 15 days is 1/6 of 90 days; 9 
 
INTEREST AND DISCOUNT 
 
 173 
 
 days, 1/10. Dividing the interest for 90 days by 6 to secure 
 the interest for 15 days, and by 10 to secure the interest 
 for 9 days, and adding, gives the result : 
 
 90 days $547.50 
 
 15 " 91.25 
 
 9 " 54.Y5 
 
 114 " $693.50 
 
 The same result may be obtained, and just as easily, by 
 the combination 90 + 18 + 6. Sometimes the work may be 
 shortened by the use of subtraction ; in the present case, no 
 time would be saved by this method, the result working out 
 as follows : 
 
 90 days $547.50 
 
 30 " $182.50 
 
 less 6 (1/5 of 30) 36.50 146.00 
 
 114 $693.50 
 
 In the case of problem (3-d), on the 5% basis, the result 
 would work out as follows : 
 
 72 days $547.50 
 
 18 " (1/4 of 72) 136.875 
 24 " (Ys of 72) 182.50 
 
 114 " $866,875 
 
 Rates like 7% or 3%%, which are not exact divisors of 
 360, must be obtained from the exact rates by division and 
 addition. Thus, 7% is derived by adding 1/6 to 6%, which 
 is obtained as follows : 
 
ly^ PROBLEMS AND STUDIES 
 
 60 days $547.50 
 
 30 " 273.75 
 
 20 " 182.50 
 
 4 " 36.50 
 
 114 " $1,040.25 (interest at Q%) 
 add 1/6 173.375 
 
 $1,213,625 (interest at 7%) 
 
 § 224. Answers to Problems in Simple Interest 
 
 Problem (1) 
 
 (a) 5 months, 2 days 
 
 (b) 5 months, 24 days 
 
 (c) 7 months, 22 days 
 
 Problem (2) 
 
 (a) August 30th 
 
 (b) September 30th 
 
 (c) February 28th or 29th 
 
 (d) March 4th or 5th 
 
 Problem (3) 
 
 (a) $693.50 
 
 (b) $691.50 
 
 (c) $780.19 (360-day method) 
 $777.94 (365-day method) 
 
 (d) $866,875 (360-day method) 
 $864,375 (365-day method) 
 
 (e) $1,040.25 (360-day method) 
 $1,037.25 (365-day method) 
 
 Problem (4) 
 
 $84.89 
 Problem (5) 
 
 $2,155.07 
 
INTEREST AND DISCOUNT 
 
 175 
 
 § 225. Problems in Compound Interest* 
 
 (6) Find the amount of $1 at 2% per period, correct to 
 six decimals : 
 
 (a) For one period 
 
 (b) For two periods 
 
 (c) For three periods 
 
 (d) For four periods 
 
 (e) For five periods 
 
 (7) Find the present worth of $1 at 2%, correct to six 
 decimals : 
 
 (a) For one period 
 
 (b) For two periods 
 
 (c) For three periods 
 
 (d) For four periods 
 
 (e) For five periods 
 
 In § 29, several methods are mentioned for finding the 
 present worth; assuming that the solutions for problem 
 (6) above have been found, the easiest method of finding 
 the present worth for five periods would be to divide 1 by 
 the amount for five periods. The present worths for 1, 2, 
 3, and 4 periods can then be found by multiplying the present 
 worth for five periods successively by 1.03.' This is much 
 easier than dividing 1 successively by 1.03. 
 
 (8) Find the amount of $1 at 1^^% (.0176) per 
 period : 
 
 (a) For one period 
 
 (b) For two periods 
 
 (c) For three periods 
 
 (d) For four periods 
 
 (e) For five periods 
 
 (f) For six periods 
 
 * In connection with the text of Chapter II, For answers see § 226. 
 
176 
 
 PROBLEMS AND STUDIES 
 
 (9) Find the present worth of $1 at 1.75% per period : 
 
 (a) For one period 
 
 (b) For two periods 
 
 (c) For three periods 
 
 (d) For four periods 
 
 (e) For five periods 
 
 (f) For six periods 
 
 (10) Find the amount and the present worth of $1,- 
 000.00 for eight periods at 1.5% per period. 
 
 (11) What is the rate of discount corresponding to 2% 
 interest ? 
 
 (12) What is the rate of interest corresponding to the 
 discount rate of .0384615? 
 
 (13) Three notes for $1,000.00 each, due (without in- 
 terest) at three months, six months, and one year respec- 
 tively, are discounted at 6% : 
 
 (a) If the proceeds of the first note are $985, find 
 
 the equivalent interest rate. 
 
 (b) If the proceeds of the second note are $970, 
 
 find the equivalent interest rate. 
 
 (c) If the proceeds of the third note are $940, 
 
 find the equivalent interest rate. 
 
 (14) What is the compound interest on $1 for five 
 periods at 2% ? 
 
 (15) What is the compound discount on $1 for four 
 periods at 2% ? 
 
 § 226. Answers to Problems in Compound Interest 
 Problem (6) 
 
 (a) $1.02 
 
 (b) $1.0404 
 
 (c) $1.061208 
 
 (d) $1.082432 
 
 (e) $1.104081 
 
INTEREST AND DISCOUNT 
 
 177 
 
 Problem (Y) 
 
 (a) $.980392 
 
 (b) $.961169 
 
 (c) $.942322 
 
 (d) $.923845 
 
 (e) $.905731 
 
 Problem (8) 
 
 (f) $1.109702 
 
 Problem (9) 
 
 (f) $.901143 
 
 Problem (10) 
 
 Amount, $1,126.493 ; present worth, $887,711 
 
 Problem (11) 
 
 .0196078 (Observe that this decimal when divided 
 by 2%, the rate of interest, gives the present 
 worth for one period, .98039. This will be a 
 test for all similar computations.) 
 
 Problem (12) 
 
 4% 
 
 Problem (13) 
 
 (a) 1.52284% quarterly, or (nominally) 
 
 6.09137% annually 
 
 (b) 3.09278% semi-annually, or (nominally) 
 
 6.18557% annually 
 
 (c) 6.38298% annually 
 
 Problem (14) 
 $.104081 
 
 Problem (15) 
 $.076155 
 
 § 227. Proof of Amount and Present Worth 
 
 The amount and the present worth of the same sum for 
 
178 
 
 PROBLEMS AND STUDIES 
 
 the same time and rate should, when multiplied together, 
 give the product 1, 
 
 Problems (6) and (7) give the amount of $1 for 5 
 periods at 2% as $1.104081, and' its present value for the 
 same time and rate as $.905731. These numbers multiplied 
 together should give as a product, unity. Such multiplica- 
 tions of decimal numbers are best performed by beginning 
 at the left of the multiplier. 
 
 1.10408 
 
 1 
 
 .905731 
 
 
 993672 
 
 9 
 
 5520 
 
 405 
 
 772 
 
 8567 
 
 33 
 
 12243 
 
 1 
 
 104081 
 
 1.000000 388211 
 The vertical line is drawn to cut off the figures beyond 
 the 6th decimal, which have no utility except to furnish a 
 carrying amount for the 6th figure. They may be dis- 
 pensed with by using contracted multiplication. 
 
 § 228. Contracted Multiplication 
 
 In this process the subproducts are shortened at each 
 step by one figure, taking into account, however, the carry- 
 ing amount from the rejected figures. 
 
 1.104081 
 .905731 
 
 (first 6 figures X 9)... 
 
 . 993673 
 
 (first 5 figures X 0) . . . 
 
 
 
 (first 4 figures X 5)... 
 
 5520 
 
 (first 3 figures X 7) 
 
 773 
 
 (first 2 figures X 3)... 
 
 33 
 
 (first figure X 1)... 
 
 1 
 
 1.000000 
 
INTEREST AND DISCOUNT 
 
 179 
 
 Here we commence to multiply by 9 at the sixth figure, 
 8 ; the product would be 72, but we know that the rejected 
 1, X 9, would make the product nearer 73 ; this subproduct, 
 therefore, becomes 993673. In each of these partial prod- 
 ucts the last retained figure is slightly increased, if neces- 
 sary, by mental allowance for the next rejected figure. The 
 last figure of the final product will, even then, not always be 
 exact, but may vary one or two units from the correct prod- 
 uct. In all multiplications by rounded decimals, there is 
 an error, small it is true, in the product; this final error 
 may be reduced to as small a quantity as desired, by in- 
 creasing the decimal places in the factors to such extent 
 as the accuracy of the work may require. 
 
 It sometimes happens in contracted multiplication that 
 you "lose your place" and forget at what figure of the 
 multiplicand to begin next. This may be overcome by tick- 
 ing off each figure as you have done with it ; or by repeating 
 the multiplier figures from left to right and (at the same 
 time) the multiplicand figures from right to left. In the 
 above illustration the correlated figures would be 9-8, 0-0, 
 5-4, 7-0, 3-1, and 1-1. 
 
 § 229. Problems in Use of Logarithms* 
 
 The following problems are elementary and the 4-place 
 table given in § 43 may be used in their solution. 
 
 (16) What is the logarithm of : 
 
 (a) 3 (d) 1.8 (g) .54 
 
 (b) 30 (e) .0018 (h) 1.03 
 
 (c) 3,000 (f) 5.4 
 
 (17) Give the number whose logarithm is: 
 
 (a) .1614 (c) 1.6474 (e) 3.6474 
 
 (b) 2.3838 (d) 1.6474 (f) .0212 
 
 * In connection with the text of Chapter III. For answers see § 231. 
 
l8o PROBLEMS AND STUDIES 
 
 (18) Find the logarithm of : 
 
 (a) 291.5 (b) 4.362 (c) .027433 
 
 (19) Find the number whose logarithm is : 
 
 (a) 2.5849 (b) 1.38425 (c) 3.6931 
 
 (20) Prove by logarithms that : 
 
 (a) 9X8 = 72 
 
 (b) 7X1.12 = 7.84 
 
 (c) .032X300 = 9.6 
 
 (d) .004X4000 = 16 
 
 (21) Show by logarithms that: 
 
 (a) 72 -f- 2.4 = 30 
 
 (b) 12.5 -^ 625 = .02 
 
 (c) 5.2^.04 = 130 
 
 (22) What is the 28th power of : 
 (a) 1.02 (b) 1.04 
 
 (23) What is the present worth of $1 for 45 periods at : 
 (a) 3% (b) 5% 
 
 (24) Find by logarithms the value of the following : 
 829 X 76.3 X .0484 -v- 7.28 -^ 25 
 
 § 230. Problems Requiring Use of More Extended Tables 
 of Logarithms* 
 
 For further exercise in logarithmic computations, Prob- 
 lems (14) to (18) inclusive should again be worked out, 
 using logarithms to the limit of such tables as may be at 
 hand. The logarithms of all of the ordinary ratios of in- 
 crease (1 + i), with which the operation always begins, will 
 be found in Part III. These logarithms have been com- 
 puted to fifteen places of decimals. 
 
 The following examples, which are for too many periods 
 to be worked out arithmetically, may also be worked by 
 
 For answers see § 231. 
 
INTEREST AND DISCOUNT igi 
 
 logarithms. If no other tables are available, the four-place 
 tables in § 43 may be used, although these tables cannot be 
 relied upon to bring correct results to as many decimal places 
 as are given in the solutions. 
 
 (25) Find the amount and present worth of $1 ; 
 
 (a) At 1.25% for 30 periods 
 
 (b) At 1.70% for 50 periods 
 
 (c) At 2.00% for 10 periods 
 
 (d) At 2.40% for 68 periods 
 
 (e) At 2.50% for 70 periods 
 
 §231. Answers to Problems in Logarithms 
 Problem (16) 
 
 (a) .4771 
 
 (b) 1.4771 
 
 (c) 3.4771 
 
 Problem (17) 
 
 (a) 1.45 
 
 (b) 242 
 Problem (18) 
 
 (a) 2.4647 
 Problem (19) 
 
 (a) 384.5 
 Problem (20) 
 
 (a) log. 9 = .9542 ; log. 8 = .9031. The sum of 
 these two logarithms is 1.8573, which is 
 the logarithm of 72. Similarly for (b), 
 (c), and (d). 
 Problem (21) 
 
 (a) log. 72 = 1.8573 ; log. 2.4 = .3802. The first 
 logarithm minus the second is 1.4771, 
 which is the logarithm of 30. Similarly 
 for (b) and (c). 
 
 (d) 
 (e) 
 (f) 
 
 .2553 
 
 3.2553 
 
 .7324 
 
 (g) 1.7324 
 (h) .0128 
 
 (c) 
 (d) 
 
 44.4 
 .444 
 
 (e) .00444 
 
 (f) 1.05 
 
 (b) 
 
 .6397 
 
 (c) 2.4383 
 
 (b) 
 
 .24225 
 
 (c) 4933 
 
l82 PROBLEMS AND STUDIES 
 
 Problem (22) 
 
 (a) log. 1.02 is .0086; multiplied by 28 gives 
 
 .2408, which logarithm corresponds to 
 the number 1.741. The correct result to 
 eight decimal places is given in Part IV, 
 being 1.74102421. 
 
 (b) 2.99; to eight decimal places, the result is 
 
 2.99870332. 
 
 Problem (23) 
 
 (a) log. 1.03 is .012.8, which multiplied by 45 
 
 gives .5760. Then log. (1^1.03"') = 
 zero minus .5760, or 1.4240. The num- 
 ber corresponding to this last logarithm 
 is .265 ; to eight places the result is 
 .26443862. . 
 
 (b) .111, and to eight places, .11129651. 
 
 Problem (24) 
 
 log. 829 =2.9186 
 plus log. 76.3 -=1.8825 
 plus log. .0484 =2.6848 
 minus log. 7.28 = .8621 
 minus log. 25 = 1.3979 
 
 Net result =1.2259, which is the logarithm 
 corresponding to the number 16.8; the 
 result by actual multiplication and divi- 
 sion is 16.82105. 
 
 Problem (25) 
 
 (a) Amount, $1.45161336 
 
 (b) " $2.32299164 
 
 (c) " $1.21899442 
 
 (d) " $5.01645651 
 
 (e) " $5.63210286 
 
 present worth, $.68888867 
 
 . " " $.43047938 
 
 " $.82034830 
 
 " $.19934390 
 
 " $.17755358 
 
CHAPTER XX 
 
 PROBLEMS IN ANNUITIES AND IN NOMINAL 
 AND EFFECTIVE RATES 
 
 § 232. Problems in Annuities* 
 
 (26) Find the amounts and present worths of an an- 
 nuity of $1 : 
 
 (a) At 1.25% for 30 periods 
 
 (b) At 1.70% for 50 periods 
 
 (c) At 2.00% for 10 periods 
 
 (d) At 2.40% for 68 periods 
 
 (e) At 2.50% for 70 periods 
 
 In Problem (26), a to e inclusive, assume that the present 
 worth in each case is a loan, and construct a schedule show- 
 ing the gradual repayment of this loan at $1 per period, for 
 a few periods or for the entire time. 
 
 § 233. Answers to Problems in Annuities 
 
 Problem (26) 
 
 (a) Amount, $36.129069 
 
 (b) " $77.823037 
 
 (c) " $10.949721 
 
 (d) " $167.352355 
 
 (e) " $185.284114 
 
 present worth, $24.888906 
 " $33.501213 
 
 " $ 8.982585 
 " $33.360671 
 
 " $32.897857 
 
 In connection with the text of Chapters IV and V. 
 
 183 
 
l84 PROBLEMS AND STUDIES 
 
 § 234. Problems in Rent of Annuity and Sinking Fund* 
 
 (27) What is the rent of an annuity of 30 periods 
 valued at $1,000 if the rate of interest is 1.25% per period? 
 In other words, what is each term of an annuity the present 
 worth of which is $1,000, the interest earned being 1.25% 
 per period and the number of periods 30 ? 
 
 (28) Assume the same present worth as in (27), and 
 find the rent of an annuity under the following conditions : 
 
 (a) 1.70%, 50 periods 
 
 (b) 2.00%, 10 periods 
 
 (c) 2.40%, 68 periods 
 
 (d) 2.50%, 70 periods 
 
 (29) What is the sinking fund to be reserved at the 
 end of each period and invested at 1.25%, to amount to 
 $1,000 at the end of 30 periods ? 
 
 (30) Compute the sinking funds for the same data as 
 in (a), (b), (c), and (d), in (28) above. 
 
 (31) What amount should be laid aside each half-year 
 to amount to $100,000 at the end of 50 years at 4% per 
 annum, interest payable semi-annually? 
 
 (32) What amount at 3% ? 
 
 (33) A father wishing to make a gift of $10,000 to his 
 son, now 15 years old, on the latter's 21st birthday, deposits 
 a certain sum at a trust company, on a 4% annual basis, on 
 the 16th and each succeeding birthday, including the 21st, 
 sufficient to amount to the $10,000 when the last deposit is 
 made. Find the required annual deposit. 
 
 (34) Assume that after the annual deposit is made on 
 the 18th birthday, the trust company states that the interest 
 rate thereafter on deposits is to be only 3% annually. Find 
 the annual amount which should be deposited on the 19th, 
 
 * In connection with the text of Chapter VII. 
 
ANNUITIES 
 
 i8S 
 
 20th, and 21st birthdays in order to reach the desired 
 $10,000. 
 
 (35) On July 1, 1914, a company decides to accumu- 
 late a sinking fund of $100,000 by July 1, 1921, assuming 
 that interest on the fund will be at the rate of 4% per 
 annum. It is expected that annual contributions to the fund 
 of $12,000 each will be made at July 1, 1917, 1918, 1919, 
 1920, and 1921. Find the two equal contributions re- 
 quired at July 1, 1915 and 1916, in order that the seven con- 
 tributions, with accumulated interest, may amount to $100,- 
 000 at July 1, 1921. 
 
 § 235. Answers to Problems in Rent of Annuity and Sink- 
 ing Fund 
 
 Problem (27) 
 $40.17854 
 
 Problem (28) 
 
 (a) $29.84967 
 
 (b) $111.32653 
 
 (c) $29.975416 
 
 (d) $30.39712 
 
 Problem (29) 
 
 $27.67854 
 
 Problem (30) 
 
 (a) $12.84967 
 
 (b) $91.32653 
 
 (c) $5.975416 
 
 (d) $5.39712 
 
 Problem (31) 
 
 $320.27 
 
 Problem (32) 
 $437.06 
 
l86 PROBLEMS AND STUDIES 
 
 Compare the answers to Problems (27) and (29)"; 
 (28-a) and (30-a) ; (28-b) and (30-b) ; (28-c) and (30-c) ; 
 and (28-d) and (30-d), respectively. Note that the differ- 
 ences between these five pairs of answers are in proportion 
 to the respective five rates of income. 
 Problem (33) 
 
 $1,507.62 
 Problem (34) 
 
 $1,571.53 
 Problem (35) 
 $14,103.35 
 
 § 236. Problems in Nominal and Effective Rates* 
 
 (36) If the interest rate is 12% per annum, payable in 
 monthly instalments, what is the effective annual rate? 
 
 (37) If the interest is 12% payable semi-annually, what 
 is the effective annual rate? 
 
 (38) What is the nominal rate per annum which, if paid 
 semi-annually, is equivalent to an effective rate of .99505% 
 per quarter? 
 
 (39) (a) If the nominal rate is 4% per annum, payable 
 semi-annually, what nominal rate per annum, payable 
 quarterly, will produce the same income ? 
 
 (b) What is the equivalent nominal annual rate, payable 
 monthly ? 
 
 (40) Interest being 6% per annum, payable quarterly 
 (the effective rate per annum being therefore 1.015^), 
 which is the more valuable — an income of $4,080, payable 
 at the end of the year, or an income of $4,000, of which 
 $1,000 is payable at the end of each quarter? 
 
 (41) Interest being worth 5% per annum converted 
 
 • In connection with the text of Chapter VIII. 
 
NOMINAL AND EFFECTIVE RATES 187 
 
 quarterly, what rate should be paid annually as an equiva- 
 lent? (Note that the expressions "payable annually," "pay- 
 able quarterly," etc., signify — through custom — that the in- 
 terest is payable at the end of the year, quarter, etc. When 
 interest is paid before the end of the interest period, an 
 element of discounting enters in.) 
 
 (42) (a) Given 5% as the effective annual rate; de- 
 scribe the process of finding the effective quarterly rate 
 equivalent thereto. 
 
 (b) What is the quarterly rate so found? 
 
 (c) To what nominal annual rate is this quarterly 
 
 rate equivalent ? 
 
 (43) A note for $1,000, due in one year, is discounted 
 at the beginning of the term, the net proceeds being $940 : 
 
 (a) What is the discount rate? 
 
 (b) What is the interest rate which is actually 
 
 being paid? 
 
 (44) If the above note were for six months and the net 
 proceeds were $970, what would be the nominal annual in- 
 terest rate? 
 
 (45) Suppose the above note were for three months and 
 the net proceeds $985 ; find the nominal annual interest rate. 
 
 § 237. Answers to Problems in Nominal and Effective 
 Rates 
 
 Problem (36) 
 12.68% 
 
 Problem (37) 
 12.36% 
 
 Problem (38) 
 4% 
 
l88 PROBLEMS AND STUDIES 
 
 Problem (39) 
 
 (a) 3.98% 
 
 (b) 3.97% 
 
 Problem (40) 
 
 The latter, by $10.90 
 
 Problem (41) 
 5.095% 
 
 Problem (42) 
 
 (a) Find the 4th root of 1.05. 
 
 (b) 1.2272% 
 
 (c) 4.9088% 
 
 Problem (43) 
 
 (a) 6% 
 
 (b) 6.383% 
 
 Problem (44) 
 6.186% 
 
 Problem (45) 
 6.091% 
 
 § 238. Constant Compounding 
 
 In § 93 it was stated that if an investment on a 6% 
 
 nominal annual rate were compounded every millionth of a 
 
 second, or constantly, the effective annual rate could never 
 
 be so great as 6.184%. It may be interesting to know how 
 
 to ascertain this limit. The following rule gives the method : 
 
 M^i Rule : Multiply the constant quantity .4342944819 +, or 
 
 \jjKj . so much thereof as is necessary, by the nominal rate per 
 
 ^^'^' annum expressed decimally; find the logarithm of the 
 
 p V^. product ; from this logarithm, subtract 1, and the remainder 
 
 is the effective annual rate required. 
 
 For example, take a 6%nominal annual rate. .4342944819 
 X .06 = .026057668914. But this latter number is the 
 
NOMINAL AND EFFECTIVE RATES 
 
 189 
 
 logarithm of 1.061837, which, diminished by 1, gives 
 .061837, which is the limit required.* 
 
 § 239. Finding Nominal Rate 
 
 The opposite rule for finding a nominal rate which, if 
 compounded an infinite number of times, will amount to a 
 given effective rate at the end of the year, is as follows : 
 
 Rule: Multiply the logarithm of the effective ratio by 
 the constant quantity 2.302585092994 +, or so much there- 
 of as is necessary, and the product will be the nominal rate 
 itself.t 
 
 Example: What rate compounded continuously will 
 amount to an effective rate of 6% ? Log. 1.06 = .02530587 ; 
 this multiplied by 2.302585 gives .058270, the rate required. 
 
 § 240. Approximate Rules 
 
 An approximation to the rate may also be obtained by 
 
 * For the benefit of more advanced readers, an algebraic demonstration of 
 the rule is here given: 
 
 (- , .08 \ n 
 ^ "r "^ / =e«<*, when n becomes infinite. 
 
 \o^. e.o« = .06 log. e = .06 log. 2.7182818284 = .06 (.4342944819) 
 = .026057668914 = log. 1.061837. Therefore, e •«• = 1.061837. 
 
 (>+f) 
 
 Therefore, ( 1 + :^ ) °^ 1.061837, when n becomes infinite. 
 
 The quantity e, used above, is the base of the Napierian system of logarithms 
 and is the sum of the infinite series, 
 
 '"■'^i^ti^ 
 
 t An algebraic demonstration of the rule is as follows : 
 
 ^^y^'^n) =106, when n becomes infinite, find the value of x, i.e., the nom- 
 inal rate. 
 
 (1 , x\ n X X 
 
 '^ n J —^ » when n becomes infinite; or e =1.06. 
 Therefore, x(log. e) = log. 1.06 
 
 Therefor., x = (log 1.06)(-^-) = (log. 1.06) {:~ii^) 
 = (log. 1.06) (2.302585092994). 
 
190 
 
 PROBLEMS AND STUDIES 
 
 subtracting from the rate half its square. The square of 
 
 .06 is .0036, one-half of which is .0018 ; .06 — .0018 = .0582. 
 
 Another approximation may be obtained by taking the 
 
 mean between the effective interest rate 06 
 
 and the corresponding discount rate .0566 
 
 which, added together, give 1166 
 
 Half of this is the approximate nominal rate 0583 
 
CHAPTER XXI 
 
 EQUIVALENT RATES OF INTEREST— BOND 
 VALUATIONS 
 
 § 241. Annual and Semi-Annual Interest 
 
 The great majority of investments pay interest semi- 
 annually. Occasionally annual-interest securities are offered, 
 and it will be useful, for comparison with the ordinary semi- 
 annual securities, to know the equivalent rates. The fol- 
 lowing table shows the equivalents for the more common 
 annual rates, the decimals being carried to the nearest one- 
 thousandth of one per cent. 
 
 Table of Equivalent Rates of Interest Payable 
 Annually and Semi-Annually 
 
 Nominal Rate 
 
 
 Nominal Rate 
 
 
 Per Annum, 
 
 
 Per Annum, 
 
 
 Payable 
 
 
 Payable 
 
 
 Annually 
 
 
 Semi-annually 
 
 
 2.50% 
 
 equivalent to 
 
 2.485% 
 
 
 2.55% 
 
 
 
 2.534% 
 
 
 2.60% 
 
 
 
 2.583% 
 
 
 2.65% 
 
 
 
 2.633% 
 
 
 2.70% 
 
 
 
 2.682% 
 
 
 2.75% 
 
 
 
 2.731% 
 
 
 2.80% 
 
 
 
 2.781% 
 
 
 2.85% 
 
 
 
 2.830% 
 
 
 2.90% 
 
 
 
 2.879% 
 
 
 2.95% 
 
 
 
 2.929% 
 
 
 191 
 
192 
 
 PROBLEMS AND STUDIES 
 
 Nominal Rate 
 
 
 Nominal Rate 
 
 
 Per Annum, 
 
 
 Per Annum, 
 
 
 Payable 
 
 
 Payable 
 
 
 Annually 
 
 
 Semi-annually 
 
 
 (Continued) 
 
 
 (Continued) 
 
 
 3.00% 
 
 equivalent 1 
 
 :o 2.978% 
 
 
 3.05% 
 
 tt t 
 
 ' 3.027% 
 
 
 3.10% 
 
 t( ( 
 
 ' 3.076% 
 
 
 3.15% 
 
 It ( 
 
 ' 3.126% 
 
 
 3.20% 
 
 (( i 
 
 ' 3.174% 
 
 
 3.25% 
 
 it i 
 
 ' 3.224% 
 
 
 3.30% 
 
 it I 
 
 ' 3.273% 
 
 
 3.35% 
 
 it i 
 
 ' 3.322% 
 
 
 3.40% 
 
 tt i 
 
 ' 3.372% 
 
 
 3.45% 
 
 tt < 
 
 * 3.421% 
 
 
 3.50% 
 
 ti i 
 
 * 3.470% 
 
 
 3.55% 
 
 tt t 
 
 ' 3.519% 
 
 
 3.60% 
 
 tt t 
 
 ' 3.568% 
 
 
 3.65% 
 
 it I 
 
 ' 3.617% 
 
 
 3.70% 
 
 tt i 
 
 ' 3.666% 
 
 
 3.75% 
 
 tt t 
 
 * 3.715% 
 
 
 3.80% 
 
 tt ( 
 
 * 3.765% 
 
 
 3.85% 
 
 tt t 
 
 ' 3.814% 
 
 
 3.90% 
 
 it t 
 
 ' 3.863% 
 
 
 3.95% 
 
 tt t 
 
 ' 3.912% 
 
 
 4.00% 
 
 it t 
 
 * 3.961% 
 
 
 4.05% 
 
 it t 
 
 ' 4.010% 
 
 
 4.10% 
 
 a i 
 
 ' 4.059% 
 
 
 4.15% 
 
 (t t 
 
 ' 4.108% 
 
 
 4.20% 
 
 it t 
 
 ' 4.157% 
 
 
 4.25% 
 
 a i 
 
 ' 4.206% 
 
 
 4.30% 
 
 it t 
 
 ' 4.255% 
 
 
 4.35% 
 
 it t 
 
 ' 4.304% 
 
 
EQUIVALENT RATES OF INTEREST 
 
 193 
 
 Nominal Rate 
 
 
 Nominal Rate 
 
 Per Annum, 
 
 
 Per Annum, 
 
 Payable 
 
 
 Payable 
 
 Annually 
 
 
 Semi-annually 
 
 (Continued) 
 
 
 (Continued) 
 
 4.40% 
 
 equivalent to 
 
 4:MS% 
 
 4.45% 
 
 (( (( 
 
 4.402% 
 
 4.50% 
 
 t( it 
 
 4.450% 
 
 4.55% 
 
 tt tt 
 
 4.500% 
 
 4.60% 
 
 li t( 
 
 4.548% 
 
 4.65% 
 
 i( it 
 
 4.597% 
 
 4.70% 
 
 it (( 
 
 4.646% 
 
 4.75% 
 
 (( (( 
 
 4.695% 
 
 4.80% 
 
 (( tt 
 
 4.744% 
 
 4.85% 
 
 tt tt 
 
 4.793% 
 
 4.90% 
 
 tt tt 
 
 4.841% 
 
 4.95% 
 
 tt tt 
 
 4.890% 
 
 5.00% 
 
 tt it 
 
 4.939% 
 
 5.25% 
 
 it tj. 
 
 5.183% 
 
 5.50% 
 
 it '« 
 
 5.426% 
 
 '5.75% 
 
 se a 
 
 5.670% 
 
 6.00% 
 
 if it 
 
 5.913% 
 
 6.25% 
 
 a tt 
 
 6.155% 
 
 6.50% 
 
 tt it 
 
 6.398% 
 
 6.75% 
 
 it it 
 
 6.640% 
 
 7.00% 
 
 it tt 
 
 •6.882% 
 
 As an illustration of the use of the^above table, 'take the 
 annual rate 2.50%. In this case, the square of 1.012425, 
 which is the semi-annual effective ratio, equals approxi- 
 mately 1.025, the annual ratio of increase. In the case of 
 the annual rate 4.45%, the square of 1.02201 equals ap- 
 proximately 1.0445, etc. 
 
194 
 
 PROBLEMS AND STUDIES 
 
 § 242. Semi-Annual and Quarterly Interest 
 
 Quarterly bonds also occur, but with less frequency than 
 semi-annual bonds. Some companies, in order to induce 
 holders of bonds to register them, pay interest quarterly 
 after registration, but semi-annually while in coupon form. 
 Sometimes, therefore, it is desirable to know approximately 
 how much improvement in income will result from the 
 quarterly payments. 
 
 Table of Equivalent Rates of Interest Payable 
 Semi-Annually and Quarterly 
 
 Nominal Rate 
 
 
 Nominal Rate 
 
 Per Annum, 
 
 
 Per Annum, 
 
 Payable 
 
 
 Payable 
 
 Quarterly 
 
 
 Semi-annually 
 
 2.60% equivalent to 
 
 2.508% 
 
 2.55% 
 
 
 2.558% 
 
 2.60% 
 
 
 2.608% 
 
 2.65% 
 
 
 2.659% 
 
 2.70%' 
 
 
 2.709% 
 
 2.75% 
 
 
 2.759% 
 
 2.80% 
 
 
 2.810% 
 
 2.85%' 
 
 
 2.860% 
 
 2.90% 
 
 
 2.910% 
 
 2.95% 
 
 
 2.961% 
 
 3.00% 
 
 
 3.011% 
 
 3.05% 
 
 
 3.062% 
 
 3.10% 
 
 
 3.112% 
 
 3.15% 
 
 
 3.162% 
 
 3.20% 
 
 
 3.213% 
 
 3.25% 
 
 
 3.263% 
 
 3.30% 
 
 
 3.314% 
 
 3.35% 
 
 
 3.364% 
 
 3.40% 
 
 
 3.414% 
 
EQUIVALENT RATES OF INTEREST 
 
 195 
 
 Nominal Rate 
 
 
 Nominal Rate 
 
 Per Annum, 
 
 
 Per Annum, 
 
 Payable 
 
 
 Payable 
 
 Quarterly 
 
 
 Semi-annually 
 
 (Continued) 
 
 
 (Continued) 
 
 3.45% equivalent to 
 
 3.465% 
 
 3.50% 
 
 
 3.515% 
 
 3.55% 
 
 
 3.566% 
 
 3.60% 
 
 
 3.616% 
 
 3.65% 
 
 
 3.667% 
 
 3.70% 
 
 
 3.717% 
 
 3.75% 
 
 
 3.768% 
 
 3.80% 
 
 
 3.818% 
 
 3.85% 
 
 
 3.869% 
 
 3.90% 
 
 
 3.919% 
 
 3.95% 
 
 
 3.970% 
 
 4.00% 
 
 
 4.020% 
 
 4.05% 
 
 
 4.071% 
 
 4.10% 
 
 
 4.121% 
 
 4.15% 
 
 
 4.172% 
 
 4.20% 
 
 
 4.222% 
 
 4.25% 
 
 
 4.273% 
 
 4.30% 
 
 
 4.323% 
 
 4.35% 
 
 
 4.374% 
 
 4.40% 
 
 
 4.424% 
 
 4.45% 
 
 
 4.475% 
 
 4.50% 
 
 
 4.525% 
 
 4.55% 
 
 
 4.576% 
 
 4.60% 
 
 
 4.626% 
 
 4.65% 
 
 
 4.677% 
 
 4.70% 
 
 
 4.728% 
 
 4.75% 
 
 
 4.778% 
 
 4.80% 
 
 
 4.829% 
 
 4.85% 
 
 
 4.879% 
 
196 
 
 PROBLEMS AND STUDIES 
 
 Nominal Rate 
 
 Per Annum, 
 
 Payable 
 
 Quarterly 
 
 (Continued) 
 
 
 Nominal Rate 
 
 Per Annum, 
 
 Payable 
 
 Semi-annually 
 (Continued) 
 
 4.90% 
 4.95% 
 
 equivalent to 4.930% 
 " 4.981% 
 
 5.00% 
 
 t( ( 
 
 ' 5.031% 
 
 5.25% 
 
 (t I 
 
 ' 5.284% 
 
 5.50% 
 
 t( ( 
 
 ' 5.538% 
 
 5.75% 
 
 (( i 
 
 ' 5.791% 
 
 6.00% 
 
 i( i 
 
 ' 6.045% 
 
 6.25% 
 
 t( ( 
 
 6.299% 
 
 6.50% 
 
 it i 
 
 ' 6.553% 
 
 6.75% 
 
 (t ( 
 
 ' 6.807% 
 
 7.00% 
 
 (( i 
 
 ' 7.061% 
 
 In illustration of the above table, take the rate 4.20% 
 given in the first column. The quarterly ratio is then 1.0105. 
 The square of this is 1.02111025, w^hich is the semi-annual 
 equivalent earning ratio ; the equivalent semi-annual rate is 
 2.111025%, and the nominal annual rate equivalent to the 
 last-named figure is approximately 4.222%. 
 
 § 243. Problems in Valuation of Bonds* 
 
 In the following problems, all bonds are supposed to be 
 semi-annual, unless otherwise stated. 
 
 (46) What is the difference between the cash and income 
 rates of: 
 
 In connection with the text of Chapter X. 
 
BOND VALUATIONS I97 
 
 (a) 4% bond netting 21/2% 
 
 (b) 3% bond netting 21/2^0 
 
 (c) 5% bond netting 3.40% 
 
 (d) 3% bond netting 3.40% 
 
 (e) Y% bond netting 4% 
 
 (f) 5% bond netting 4.80% 
 
 (g) 3.65% bond netting 5% 
 
 (47) Remembering that the premium or discount on a 
 bond is the present worth of an annuity of the difference in 
 rates, at the income rate, and that problems have already- 
 been given involving the computation of present worths at 
 the foregoing income rates (Problem 26), find the premium 
 or discount on the following bonds, and hence their value, 
 par being $1,000 in each case : 
 
 (a) 4% bond netting 2%%, 15 years 
 
 (b) 3% bond netting 21/2%, 15 years 
 
 (c) 6% bond netting 3.40%, 25 years 
 
 (d) 3% bond netting 3.40%, 25 years 
 
 (e) 7% bond netting 4%, 10 years 
 
 (f) 5% bond netting 4.80%, 34 years 
 
 (g) 3.65% bond netting 5%, 35 years 
 
 § 244. Successive Method of Bond Valuation — Problems 
 
 By adding the net income for one period to each of the 
 computed values, and subtracting the cash interest, find the 
 next periodic value at 141/2, 241/2, 91/2, 331/2, and 34% 
 years, respectively. Continue this operation as many times 
 as you please, and at any point you may prove your work by 
 a fresh computation of the annuity. 
 
 (48) Find the value of a 4%% bond having a par of 
 $10,000, netting 3%%, and having three years to run. 
 From this initial value, work out the values successively 
 down to par at maturity, and construct a schedule as in 
 §122. 
 
198 PROBLEMS AND STUDIES 
 
 (49) Perform the same operation with: 
 
 (a) a 470 bond 
 
 (b) a 3% bond 
 
 (c) a 2% bond 
 
 (50) By the use of logarithms, find the values of the 
 following bonds of $1,000 each : 
 
 (a) 4% bond, netting 4.50%, 95 years 
 
 (b) 3%% bond, netting 3%, 401/2 years 
 
 (c) 7% bond, netting 4%%, 45 years 
 
 (d) 5% bond, netting 4%, 28 years 
 
 (e) 31/^% bond, netting 3.80%, 100 years 
 
 § 245. Answers to Bond Valuation Problems 
 
 Problem (46) 
 
 (a) .75% 
 
 (c) .80% 
 
 (e) 1.5% 
 
 (b) .25% 
 
 (d) .20% 
 
 (f) .1% 
 
 (g) .675% 
 
 Problem (47) 
 
 
 
 (a) $1,186.67 
 
 (c) $1,268.01 
 
 (e) $1,245.27 
 
 (b) $1,062.22 
 
 (d) $933.00 
 
 (f) $1,033.36 
 
 (g) $777.94 
 
 Problem (48) 
 
 
 
 $10,282.45 
 
 
 
 Problem (49) 
 
 
 
 (a) $10,141.22 
 
 (b) $9,858.78 
 
 (c) $9,576.33 
 
 Problem (50) 
 
 
 
 (a) $890.51 
 
 (c) $1,480.56 
 
 (e) $922.88 
 
 (b) $1,116.77 (d) $1,167.52 
 
 § 246. Bond Valuations by the Use of Logarithms 
 
 The following will illustrate the method of solution by 
 logarithms, taking (for example) Problem (50-a). Here 
 the number of periods is 190, the difference between the 
 
BOND VALUATIONS Iqq 
 
 cash and income rates per period is $2.50, and the income 
 rate is 2.25% per period. We must therefore find the 
 present worth (P) of an annuity of $2.50 for 190 periods 
 at 2.25%, and subtract this from the par of the bond 
 ($1,000), since this bond is at a discount, the income rate 
 being larger than the cash rate. The formula for the 
 value of the discount on a bond, as given in § 159, 
 
 is(t-g) n~ (l-^i)A 
 
 which becomes (2.50)( "^ "" 1.0225^^M 
 ^ .0225 / 
 
 Now, log. 1.0225 = .00966331668. 
 
 Therefore, log. 1.0225''° = 190 X .00966331668 = 
 1.8360301692. 
 
 Hence, ^og.\z^^^^^]-=\og. 1-log. 1.0225"« 
 
 = zero — 1.8360301692 = 2.1639698308. 
 
 The number corresponding to this logarithm is .014587128. 
 
 The value of the discount thus becomes : 
 
 2.50 
 
 /l --.01458Y128 \ 
 \ .0225 / 
 
 which equals $109.49. This discount when deducted from 
 the par of $1,000 gives the value of the ix)nd, $890.51. 
 
 The solution by logarithms involves considerable "figur- 
 ing,'* but is nevertheless far superior to any solution by 
 ordinary arithmetic. The labor of finding the present worth 
 of an annuity for 190 periods by arithmetic would be 
 intolerable. 
 
200 PROBLEMS AND STUDIES 
 
 § 247. Finding Initial Book Values 
 
 The methods of finding the initial book values of the 
 bonds in Schedules (A) and (B) (§ 122) are not shown 
 in the text. The operation is here given without logarithms, 
 and with some variations in method. 
 
 Take the case of the bond in Schedule (A), a 5% bond 
 for $100,000 to net 4%, due in 5 years. The problem is 
 to find the present value of an annuity of $500 for 10 
 periods at the ratio 1.02 ; but in the present method we also 
 require the separate present worths of each instalment of 
 $500. These ten present worths are the ten respective 
 amounts of amortization for the ten periods in the life of 
 the bond. 
 
 The present worth of the first instalment of $500 (i.e., 
 the first amortization) will be $500 -^ 1.02^^ the present 
 worth of the second will be $500 -^ 1.02^ ; etc. Since mul- 
 tiplication is easier than division, it will be best to obtain 
 first the value of 1-^1.02"; 500 times this will give the 
 present worth of the first instalment, or the first entry in 
 the amortization column. From the first amortization, the 
 second and following ones may be obtained by successive 
 multiplications by 1.02. 
 
 To obtain the value of 1 -^ 1.02'^ we find first the 10th 
 power of 1.02. After multiplying 1.02 by itself, we do not 
 again use it as a multiplier, but square the square, giving 
 the fourth power. The 4th multiplied by the 4th gives the 
 8th, and the 8th multiplied by the 2nd gives the 10th power 
 of 1.02, as shown on the following page. A check on the 
 accuracy of the result may also be obtained by employing the 
 method suggested in the footnote of § 19. In this latter 
 case, the process consists in finding the value of (1 + .06)^^ 
 by the use of the algebraic formula known as the binomial 
 theorem. 
 
BOND VALUATIONS 
 
 201 
 
 102 
 
 
 102 
 
 
 102 
 
 
 204 
 
 
 10404 
 41616 
 41616 
 
 (102^) (It is unnecessary to 
 repeat the multiplier) 
 
 108243216 
 865945728 
 
 (102^) = (102^)^ 
 
 21648643 
 4329729 
 
 (contracted multiplication) 
 
 324730 
 
 
 21649 
 
 
 1082 
 
 
 649 
 
 
 11716593810 1 
 10404 
 
 (102)«=(102*)^ 
 
 11716593810 
 
 
 468663752 
 
 
 4686638 
 
 
 12189944200 (102)^"= (102«) X (102') 
 
 § 248. Tabular Multiplication and Contracted Division 
 
 Next, 1 is to be divided by 1.21899442. We shall use 
 contracted multiplication, and further facilitate the work by 
 employing the tabular plan. This consists in preparing in 
 advance a table of the first 9 multiples of 1.21899442 in such 
 a way that we are certain of their correctness. The use of 
 a table such as this greatly facilitates accuracy and quickness 
 in performing the division of several numbers by the same 
 divisor, especially in cases where the divisor is lengthy and 
 no calculating machines are available. 
 
202 
 
 PROBLEMS AND STUDIES 
 
 On the first line of the table we set down the number, and 
 on the second line, its double. 
 
 121899442 
 
 243798884 
 
 Proof 
 
 The third line is formed by adding the first to the second, 
 and all the others in succession by adding the first. The 
 proof line is 10 times the original, if there is no mistake in 
 the work. 
 
 121899442 
 
 243798884 
 365698326 
 487697768 
 609497210 
 731396652 
 853296094 
 975195536 
 097094978 
 
 Proof 
 
 1218994420 
 
 The contracted division consists in merely subtracting 
 these multiples. The quotient may as well be placed above 
 the dividend to save space. 
 
BOND VALUATIONS 
 Quotient 820348300 
 
 203 
 
 Dividend 
 (8) 
 
 1000000000 
 975195536 
 
 (2) 
 
 24804464 
 24379888|| 
 
 (03) 
 
 424576 
 365698 1 
 
 (4) 
 
 58878 
 48760 
 
 (8) 
 
 10118 
 9752 
 
 (3) 
 
 366 
 366|| 
 
 $.8203483 is therefore the present v^orth of $1 due in 
 5 years ; its product by 500 is the first amortization : 
 
 $410.17415 
 Subtracting this from. , 500. 
 
 gives the compound discount $ 89.82585 
 
 Dividing this by .02 gives 4491.2925 (D-^t = P) 
 
 or the premium, rounded to 4491.29 1| 
 
 § 249. Formation of Successive Amortizations 
 
 Our amortization column v^ill begin v^ith $410.17, and 
 each successive term will be 1.02 times the preceding, while 
 the sum of the column must be $4,491.29. To insure ac- 
 curacy in the last figure, it will be well to retain at least the 
 mills. Having obtained all the ten terms, the multiplication 
 is performed once more, giving as a test $500. The terms 
 
204 PROBLEMS AND STUDIES 
 
 are again tested by addition, bringing the result, $4,491.29. 
 Then the book values beginning with $104,491.29, and end- 
 ing with $100,000, are formed by subtraction, still retain- 
 ing the mills. In making up the schedule the values are 
 rounded to the nearest cent, and the amortization column is 
 made to correspond. 
 
 $410,174 
 
 $104,491,292 
 410.174 
 
 418.377 
 
 $104,081,118 
 
 418.377 
 
 426.745 
 
 $103,662,741 
 426.745 
 
 435.280 
 
 $103,235,996 
 435.280 
 
 443.986 
 
 $102,800,716 
 443.986 
 
 452.866 
 
 $102,356,730 
 452.866 
 
 461.923 
 
 $101,903,864 
 461.923 
 
 471.161 
 
 $101,441,941 
 471.161 
 
 480.584 
 
 $100,970,780 
 480.584 
 
 490.196* 
 
 $100,490,196 
 490.196 
 
 
 $100,000,000 
 
 Total, $4,491,292 
 
 
 
 
 • $490,196 X 1.02 = $500 
 
 
BOND VALUATIONS 205 
 
 § 250. Test by Differencing 
 
 In a successive computation like the one just given, a 
 slight error increases at every step, and there is danger that 
 a great many terms may have to be recalculated. The 
 method of differencing, applied during the progress of the 
 work, will form an efficient check on all except the last 
 figure. 
 
 § 251. Successive Columns 
 
 To difference a series, we first set down its terms in a 
 first column. In the second column we set down the first 
 differences (Di), of which the first line is the difference be- 
 tween the first term and the second, the second line is the 
 difference between the second and the third, and so on. 
 D2 is composed of the differences between these first differ- 
 ences. D3 is formed from D2 in just the same way as Da 
 from Di, and all succeeding differences in the same way, to 
 the extent required. 
 
 The terms just obtained in amortizing $104,491,292 
 down to par, would be differenced as follows : 
 
 Term 
 
 D. 
 
 D, 
 
 D, 
 
 410.174 
 
 8.203 
 
 .165 
 
 .002 
 
 418.377 
 
 8.368 
 
 .167 
 
 .004 
 
 426.745 
 
 8.535 
 
 .171 
 
 .003 
 
 435.280 
 
 8.706 
 
 .174 
 
 .003 
 
 443.986 
 
 8.880 
 
 .177 
 
 .004 
 
 452.866 
 
 9.057 
 
 .181 
 
 .004 
 
 461.923 
 
 9.238 
 
 .185 
 
 .004 
 
 471.161 
 
 9.423 
 
 .189 
 
 .003 
 
 480.584 
 
 9.612 
 
 .192 
 
 
 490.196 
 
 9.804 
 
 
 
 500.000 
 
 
 
 
2o6 PROBLEMS AND STUDIES 
 
 § 252. Intentional Errors 
 
 To demonstrate the utility of the method, introduce an 
 error purposely by altering one of the figures in a term at 
 least three or four lines from the top. Even a mill, when 
 all the differences are carried out, will cause violent fluctua- 
 tions in the column IX and instantly call attention to the 
 error. 
 
 § 253. Rejected Decimals 
 
 The reason the fourth column shows some fluctuation 
 even though no errors have been made, is that the last 
 figure of a term is never accurate, but always rounded 
 off or up. In a third difference-column, this residue of error 
 increases threefold; in a fourth column, it may reach six 
 times the original rounding, and, in the fifth, ten times. 
 
 § 254. Limit of Tolerance 
 
 The extent to which the last column of differences may 
 be allowed to "waver" will be learned by experience. The 
 next-to-the-last column should be progressive; that is, it 
 should never change its course and go backward ; it should 
 either constantly increase or constantly decrease. 
 
 It will be a useful exercise to take the more extended 
 value, $410.17415 (instead of $410,174), multiply it up to 
 $500, and difference the results out to 5 differences. A very 
 minute error will become enormously magnified and call 
 attention to itself. 
 
CHAPTER XXII 
 
 BROKEN INITIAL AND SHORT TERMINAL 
 BONDS 
 
 § 255. Problems in Valuation* 
 
 (51) Suppose the value of a 4% bond for 15 years on 
 a 2%% basis to be, as shown in Problem (4Y-a), $1,- 
 186.66680; what would be its value one month later, the 
 time prior to maturity then being 14 years, 11 months? 
 (Since we are dealing with half-years, this time must be 
 treated as 14% years, 5 months, or 15 years less 1/6 of the 
 semi-annual amortization period.) 
 
 The theoretical, or mathematically correct, value (§ 129) 
 In the above case would be ascertained as follows : 
 
 The ratio of increase is 1.0125 
 
 Its logarithm is 005 395 031 887 
 
 This must be divided by 6, giving .000 899 171 981 
 
 which is the logarithm of the 6th 
 
 root of 1.0125, or (in other words) 
 
 the logarithm of the effective ratio 
 
 for 1/6 of a semi-annual period. 
 The number corresponding to the last 
 
 logarithm is 1.002 072 564 8 
 
 Multiplying the value at the begin- 
 ning of the 15-year period ($1,- 
 
 186.66680), by this number, gives 
 
 the flat value at 14 years, 11 months, 
 
 before maturity $1,189,126 21 
 
 * In connection with the text of Chapter XI. 
 
 207 
 
2o8 PROBLEMS AND STUDIES 
 
 Although the above method is never used in actual buy- 
 ing or selling, yet it is proper for estimating results of 
 financial operations. 
 
 (52) A firm of brokers offers $50,000 of 3% bonds, due 
 July 1, 1929, J & J, on a 21/2% basis. What should be the 
 price on September 25, 1914, flat or "and interest"? 
 
 (53) On July 10, 1913, $25,000 of 5% bonds due 
 April 1, 1938, A & O, are bought at a price to yield 3.40%. 
 
 (a) What is the flat price ? 
 
 (b) What is the price "and interest"? 
 
 (54) $10,000 of 3% bonds due January 1, 1938, J & J, 
 are purchased to net 3.40%. Find the price exclusive of 
 interest and the price flat, on May 16, 1913. 
 
 (55) $6,000 of 41/2% bonds were issued in 1908, due 
 April 1, 1928, M & N. Find the price "and interest," on 
 July 1, 1914, on a 4.80% basis. 
 
 (56) An investor owns the four lots of bonds men- 
 tioned in Problems (52), (53), (54), and (55), and has 
 hitherto carried them on his books at par. He desires to 
 have them adjusted to investment value as of December 31, 
 1914. What will be the investment value: 
 
 (a) Of each lot? 
 
 (b) Of the aggregate? 
 
 (57) Find the amount of amortization for the semi- 
 annual period ending June 30, 1915 : 
 
 (a) On each of these lots of bonds. 
 
 (b) On the aggregate of the four lots. 
 
 (58) Taking the bonds in Problem (53), ascertain their 
 values at April 1 and October 1, 1937, and thence at July 
 1, 1937. From this last value, (a) amortize to January 1, 
 1938, (b) and then for the broken period to April 1, 1938, 
 when they should reduce to par. 
 
 (59) Taking the bonds in Schedule (H) (§141), re- 
 
SHORT TERMINAL BONDS 209 
 
 construct the schedule so that the next date after May 1, 
 1914, is July 1, 1914; then January 1, 1915, and so on at 
 balancing periods,, giving a J & J schedule instead of an 
 M & N schedule. 
 
 (60) A certain issue of $100,000 of 4% bonds is dated 
 September 1, 1913, and interest begins at that date; but in- 
 terest is payable on February 1 and August 1, and the prin- 
 cipal (with 4 months' interest) is payable December 1, 1917. 
 
 (a) What is the value of the bonds on a 3.60% 
 
 basis at the date of issue ? 
 
 (b) What is their value on the same basis if pur- 
 
 chased at December 1, 1913 ? 
 
 (c) At August 1, 1917? 
 
 (In this question, note that the period at the beginning 
 is for 5 months, and not the usual 6 months. ) 
 
 (61) Make a schedule running from December 1, 1913, 
 to maturity, of the above bonds at the F & A dates. 
 
 (62) Make a schedule as above, but with J & J dates, 
 for balancing purposes. 
 
 (63) A broker offers the above bonds on December 1, 
 1913, at 101.50 (meaning $101.50 for each $100 of par, 
 which is the customary phrase), which he says will pay 
 about 3.60%. Eliminate any residue by the methods in 
 §§ 136 to 139, inclusive, making a J & J schedule* running 
 to maturity. 
 
 As will be noted, this last example contains all of the 
 following peculiarities: short initial period, odd purchase 
 date in that period, short terminal period, interpolated 
 balance dates, and residue to be eliminated. 
 
 § 256. Answers to Valuation Problems 
 
 Problem (51) 
 
 $1,189.13902 (by the customary method). 
 
2IO PROBLEMS AND STUDIES 
 
 Problem (52) 
 
 $53,420.93 flat, or $53,070.93 and interest. 
 Problem (53) 
 
 (a) $31,996.64 flat. 
 
 (b) $31,652.89 and interest. 
 
 Problem (54) 
 
 $9,336.43 and interest, or $9,448.93 flat. 
 Problem (55) 
 
 $5,820.34 and interest. 
 Problem (56) 
 
 (a) $53,025.00; $31,392.26; $9,365.30; $5,825.03. 
 
 (b) $99,607.59. 
 
 Problem (57) 
 
 Amortization, $87.19 and $91.33; accumulation, 
 $9.21 and $4.80; net amortization, $164.51. 
 
 Problem (58) 
 
 Value at January 1, 1938, $25,098.33; for the 
 broken period from January 1 to April 1, ■ 
 1938, interest on premium is $1.67, interest 
 on par is $212.50, and cash interest is $312.50, 
 thus reducing the bond to par. 
 
 Problem (59) 
 
 July 1, 1914, $104,693.02 ; January 1, 1915, $104,- 
 286.88 ; etc. ; July 1, 1919, $100,245.90. 
 
 Problem (60) 
 
 (a) September 1, 1913, $101,563.90. 
 
 (b) December 1, 1913, $101,477.98. 
 
 (c) August 1, 1917, $100,131.75. 
 
 Problem (61) 
 
 Value at February 1, 1914, $101,420.69; etc. 
 
SHORT TERMINAL BONDS 2II 
 
 Problem (62) 
 
 Value at January 1, 1914, $101,449.33 ; at July 1, 
 1914, $101,275.34; etc. 
 
 Problem (63) 
 
 The residue is $22.02, being the difference between 
 $101,500.00 and $101,477.98. The co- 
 efficient for elimination of the residue is 
 1.0148987, meaning that for every dollar of 
 amortization on the bonds bought at the exact 
 3.60% basis, there should be added 1.48987c. 
 if the bonds are bought on the approximate 
 3.60% basis, i.e., $101,500.00. 
 
CHAPTER XXIII 
 
 THE USE OF TABLES IN DETERMINING THE 
 ACCURATE INCOME RATE 
 
 § 257. Bond Tables as Annuity Tables 
 
 The "Extended Bond Tables"* can be used as an annuity 
 table in case of need, when the latter is not at hand or when 
 the figures in it are not sufficiently extended or the rates not 
 sufficiently close. 
 
 In using the "Extended Bond Tables" for this purpose, 
 it must be remembered that its results are based on semi- 
 annual payments of interest, the periods being half-years. In 
 the foregoing problems on annuities where periods and rates 
 per period are used, in order to make use of the bond tables 
 these "periods and rates per period" must be transformed 
 into years and rates per annum, payable semi-annually. In 
 this manner the data given in Problem (26) will be changed 
 as follows : 
 
 1.25%, 30 periods, becomes 2.50%, 15 years. 
 1.70%, 50 periods, becomes 3.40%, 25 years. 
 2.00%, 10 periods, becomes 4.00%, 5 years. 
 2.40%, 68 periods, becomes 4.80%, 34 years. 
 2.50%, 70 periods, becomes 5.00%, 35 years. 
 
 § 258. Premium and Discount as a Present Worth 
 
 As explained in Chapter X, the premium or discount on 
 a bond is nothing more or less than the present worth, at 
 
 Spraguc's "Extended Bond Tables." 
 212 
 
DETERMINING ACCURATE INCOME RATE 213 
 
 the income rate, of an annuity for the life of the bond equal 
 to the difference between the cash and income rates. Tak- 
 ing, as an illustration, the second case mentioned above, 
 3.40% for 25 years, we turn to the 5% bond table, page 88,* 
 
 and find the value of such a bond to be $1,268,009.70 
 
 The value of a similar bond in the 4% table, 
 
 page 54* is 1,100,503.64 
 
 Difference $167,506.06 
 
 The first amount results from a cash rate of 5% and 
 an income rate of 3.40% ; in the case of the second amount, 
 the cash rate is 4%, with the same income rate. The differ- 
 ence between these two amounts arises therefore on account 
 of the difference in cash rates, which, for a bond of $1,- 
 000,000, is $10,000 annually. In other words, the differ- 
 ence is the present worth of an annuity of $10,000 per 
 annum, payable semi-annually, at 3.40% for 25 years. Ex- 
 pressed in periods, it is the present worth of an annuity of 
 $5,000 per period, for 50 periods, at 1.70% per period. The 
 present worth of an annuity of $1 per period, under like 
 conditions, would therefore be 1/5000 of $167,506.06, or 
 $33.501212. 
 
 § 259. Present Worth by Differences 
 
 Instead of using the coupon rates 4% and 5%, we might 
 have selected 3% and 4%, 31/2% and 41/2%, 5% and 6%, 
 or any other two rates differing by 1%. For example : 
 
 Value of 4% bond, yielding 3.40% $1,100,503.64 
 
 Value of 3% bond, yielding 3.40% 932,997.57 
 
 Difference, being value of annuity. ......... $167,506.07 
 
 *Sprag:ue'8 "Extended Bond Tables. 
 
214 PROBLEMS AND STUDIES 
 
 There is a discrepancy of one cent in comparison with 
 the previous difference, owing to the rounded decimals. 
 The reason for the process may be explained as follows : 
 
 On a 6% bond of $1,000,000 yielding 
 
 3.40% the cash, or coupon, interest is. .$50,000 
 the net income is 34,000 
 
 Difference $16,000 
 
 In the case of a 4% bond, the interest at 
 
 the cash or coupon rate is $40,000 
 
 the net income is. 34,000 
 
 Difference $6,000 
 
 The term "net income,'' as here used, has a slightly 
 different meaning from its use in the schedules in Chapters 
 X and XI ; in the latter case, the income rate was applied to 
 the book value, while in the present instance it is applied to 
 the par value. 
 
 Hence, from the bond tables we may derive the present 
 worths of two annuities of $16,000 and $6,000 (being re- 
 spectively $268,009.70 and $100,503.64), and their differ- 
 ence must always be the present worth of an annuity of 
 $10,000. From the foregoing, we may state the following : 
 
 Rule : The present worth of an annuity of $10,000, pay- 
 able semi-annually, at a certain income rate, is equal to the 
 difference between the values of a 4% and a 5% bond for 
 $1,000,000 at the same income rate. 
 
 If it should happen that the rent of the desired annuity 
 were $5,000 instead of $10,000, the present worth thereof 
 might be obtained at once from the difference in values be- 
 tween 3% and 31/2% bonds, or between 31/2% and 4% 
 bonds. Similarly, the difference between 31/^ % and 5% 
 bonds would give the present worth of an annuity of $16,- 
 
DETERMINING ACCURATE INCOME RATE 
 
 215 
 
 000; 3% and 5%, $20,000; 31/2% and 6%, $25,000; 3% 
 and 6%, $30,000; 31/2% and 7%, $35,000; and 3% and 
 7%, $40,000. These results would be a trifle more accurate 
 in the last figure than those obtained by multiplying the 
 present worths of the $10,000 annuities, since the multiplica- 
 tion of figures which have been rounded increases the error. 
 
 § 260. Present Worth by Division 
 
 The present worth of an annuity may also be obtained 
 by division from a single bond value, instead of taking the 
 difference between two. We saw that the premium on a 4% 
 bond to net 3.40% is the present worth of an annuity of 
 $6,000, payable semi-annually; therefore, if the premium be 
 divided by 6, it will give the present worth of an annuity 
 of $1,000, payable semi-annually : 
 
 $100,503.64 -^- 6 = $16,750.61 
 
 § 261. Compound Discount and Present Value of a Single 
 Sum 
 
 From the present worth of an annuity of $10,000 ob- 
 tained as above, the compound discount and the present 
 value of a single sum for the same time and rate can also 
 be ascertained. Multiplying the present worth of the an- 
 nuity by the number of units in the rate per cent gives the 
 compound discount on a single sum of $1,000,000. 
 
 $167,506.06 times 3.4 = $569,520.60 compound discount 
 Subtract this from 1,000,000.00 
 
 and we have $430,479.40, which is the present 
 
 worth of $1,000,000 payable in a single sum in 25 years at 
 3.40% compounded semi-annually. These computations are 
 merely applications of the two formulas, PX** = D (§67) 
 and p = l — D (§35). The last figure in the above present 
 
2l6 
 
 PROBLEMS AND STUDIES 
 
 worth is unreliable; as a matter of fact, the cents should 
 be 38. 
 
 If necessary, in the absence of compound interest tables 
 or logarithms, the amount of a single sum at compound in- 
 terest may be obtained through the application of the 
 formula a^l^p (§35). The present value of $1 (or p) 
 is $.4304794; therefore, divide 1 by .4304794, using con- 
 tracted multiplication. 
 
 4304794 ) 1.0000000 ( 2.3229917 
 
 8609588 
 
 1390412 
 
 
 1291438 1 (The sign | indicates con- 
 
 
 traction or rounding.) 
 
 98974 
 
 
 86096| 
 
 
 12878 
 
 
 8610 
 
 
 4268 
 
 
 3874 
 
 (For explanation of 
 
 
 contracted multiplica- 
 
 394 
 
 tion, see § 228.) 
 
 387 1 
 
 
 7 
 
 
 4]| 
 
 
 3 
 
 § 262. Use of Bond Tables in Compound Interest Problems 
 
 The amount of $1 for 50 periods at 1.70% per period, as 
 above computed, is $2.3229917, and the compound interest 
 is $1.3229917. If the latter amount be divided by .017, the 
 rate of income for a single period, the result ($77.82306) 
 will be the amount of an annuity of $1 for 50 periods at 
 
DETERMINING ACCURATE INCOME RATE 
 
 217 
 
 1.70% ; being an application of the rule (§ 60) A = 1 -^i. 
 Again, when this result ($77.82306, or A) is divided by 
 2.3229917 (or a) the quotient is $33.5012 + (or P), which 
 is the present worth of an annuity of $1 for 50 periods at 
 1.70%. This is an application of the formula (§67) 
 P = A -^ a. The quotient last obtained checks very closely 
 with the result previously found for the value of P, 
 $33.501212. Thus, all of the problems in compound in- 
 terest are soluble through the bond tables. 
 
 §263. Determination of the Accurate Income Rate* 
 
 As stated (§ 136), values of bonds for each one- 
 hundredth of one per cent of gradation in the ordinary in- 
 come rates may be obtained from Sprague's "Extended 
 Bond Tables." If, however, an even more minute degree of 
 accuracy is desired in the income rate, as, for example, a 
 rate like 4.2678%, these tables are not sufficient. In order 
 to develop a method to accomplish this result, we will first 
 state the problem in symbolic form : 
 
 Given a bond on which there is a premium or discount 
 Q, cash rate c, and number of periods n, what is the income 
 rate i? 
 
 Every premium or discount is the present worth, at the 
 income rate, of an annuity of n terms, each instalment of 
 which is the difference between the cash and income rates; 
 in other words, it is the present worth of an annuity of $1 
 multiplied by the difference in rates (§118). Writing P 
 for the present worth of an annuity of $1, we have the 
 equation : Q = P X (c — i) . The terms c and i, in the great 
 majority of bonds, theoretically refer to the rates for semi- 
 annual periods. In practice, however, a 4% rate or a 5% 
 rate means an annual nominal rate, irrespective of the fact 
 that the coupons are semi-annual. In order to conform to 
 
 Compare text of §§ 135, 136. 
 
2i8 PROBLEMS AND STUDIES 
 
 commercial usage, we will alter the equation by halving the 
 P and doubling the (c — i) ; the equation then becomes : 
 Q = 1/2? X {2c— 2i). With this change, the value of the 
 right-hand member is not altered, and there is the advantage 
 that the quantities 2c and 2i represent, respectively, the 
 nominal annual cash and income rates. 
 
 § 264. Assumed Trial Rate 
 
 In the equation given above, the premium or discount Q 
 is known, and the cash rate c is also known. There is there- 
 fore, in reality, but one unknown quantity, the income rate 
 i, since P can be ascertained when once the value of i is 
 known. It is evident that if we divide Q by %P (which 
 latter we will hereafter call the trial divisor), we shall find 
 the difference in rates. Let us assume the rate of income 
 to be any rate whatever, and then calculate the trial divisor 
 at that rate. Then, since the product of %P times (2c — 2i) 
 is the constant, or known, quantity Q, we have the following 
 chain of reasoning: If the assumed income rate is too 
 small, P will be too large, the difference in rates will be too 
 small, and the ascertained income rate will be too large ; and 
 vice versa if the assumed income rate is too large. Taking 
 now this first ascertained rate as the new assumed rate, we 
 may find a second ascertained rate, and so on, as many times 
 as we please, the proceeding being something like the swing- 
 ing of a clock pendulum, except that each swing is shorter 
 than the preceding one, since the successive ascertained rates, 
 one after another, more nearly approach the true income 
 rate. We may slightly modify any rate in order to make 
 the work easier; if we are fortunate in selecting our first 
 trial rate near the true rate, fewer successive approximations 
 will be necessary. 
 
 For the purpose of computing the value of the tria! 
 divisor (%P), a table of bond values may be used for 
 
DETERMINING ACCURATE INCOME RATE 219 
 
 the first two or three approximations, by taking the differ- 
 ence between the values (at the same income rate) of a 
 3% bond and a 4% bond, or of some other pair of bonds 
 whose nominal annual cash rates differ by 1%. 
 
 §265. Application of Assumed Trial Rate — Bond Above 
 Par 
 
 As an example, we will take a 6% semi-annual bond for 
 $100, due in 50 years and sold at 133, to find the income 
 rate. With so large a premium as 33, the income rate is 
 evidently much less than 6% ; let us assume 4%. From the 
 bond tables we find that the value of a 5% bond, due in 
 50 years, and earning 4%, on a par of 100, is. . . .$121,549 
 The value of a similar bond earning only 4% is 
 
 par, or • 100.000 
 
 The difference is the present worth of an annuity 
 of 50c. (the difference between the semi-annual 
 cash and income rates) for 100 periods at 2% 
 per period $21,549 
 
 The present worth of a similar annuity of $1, or 
 
 P, is $43,098 
 
 %P, the first trial divisor, is therefore $21.55 
 
 33.00^21.55 = 1.531, the difference in rates. 6% — 
 1.531 = 4.469%, the new trial rate. Taking 4.45% as more 
 convenient, the new trial divisor is 19.98. 33.00 -^ 19.98 = 
 1.651. 6% — 1.651% =4.349%. For this new rate (or 
 4.35%), we find that 20.315 is the trial divisor. 33.00-^ 
 20.315 = 1.6244. 6% — 1.6244% = 4.3Y56%. Next using 
 4.37%, the trial divisor is 20.25. 33.00-^20.25 = 4.37, 
 almost exactly, so that the use of 4.37% as an assumed or 
 trial rate leads to it again as an ascertained rate; in other 
 words, the rate 4.37% reproduces itself, which shows that 
 
 '/' 
 
220 PROBLEMS AND STUDIES 
 
 we have now found the correct rate. The value of the bond 
 at 4.37%, as computed by logarithms, is $133.0069, an 
 error of less than one cent. 
 
 § 266. Variations in Assumed Rates 
 
 The example in § 265 is an illustration of what we have 
 previously pointed out ; that is, that the results always swing 
 to the opposite side of the true rate. If the trial rate is too 
 large, the ascertained rate will be too small, and the true 
 rate will lie between them. The successive rates were 4%, 
 4.469%, 4.349%,4.3756%, and 4.37%. 4.37% lies between 
 any pair of these rates except the last two, where one rate 
 coincides with 4.37%. The foregoing is always the case 
 with bonds above par. With bonds below par it is different ; 
 here the true rate is always larger than the last approxima- 
 tion. The ascertained rate may be carried to many decimal 
 places, but it never quite overtakes the true rate. The case 
 is somewhat analogous to a circle having an inscribed 
 polygon. We may increase the number of sides of the 
 polygon indefinitely, but its area will never quite equal the 
 area of the circle. 
 
 §267. Application of Assumed Trial Rate — Bond Below 
 Par 
 
 As an example of a bond below par, take a 3% bond 
 payable in 25 years. If purchased at 88.25, what is the 
 income rate ? The following may be the steps, the dividend 
 being always 11.75, the discount: 
 
 Trial rates 3.70% 3.725% 3.7265% 
 
 Trial divisors 16.2190 16.175 16.17245 
 
 Ascertained rates. 3.7244% 3.7264% 3.7265% 
 
 Since 3.7265% reproduces itself, it must be correct to 
 the 4th decimal. Tested by logarithms, the value of a 3% 
 bond for 25 years yielding 3.7265% proves to be $88.25018. 
 
DETERMINING ACCURATE INCOME RATE 221 
 
 § 268. Trial Rates from Bond Tables 
 
 While the method of trial rates is correct in theory, it 
 may be greatly facilitated in practice by first locating by 
 means of bond tables* the required income rate between two 
 rates one-hundredth of one per cent apart. The results will 
 be so close that simple interpolation (explained in Chapter 
 XXXI) will suffice for at least seven decimals, and the 
 laborious divisions necessary in the foregoing method will 
 be avoided. 
 
 § 269. Use of Bond Tables 
 
 For example, let it be required to find the income rate of 
 a 4% bond for $1,000,000 due in 100 years, bought for $1,- 
 264,806.66. From the 4% table, we find that the income 
 rate must lie between 3.10% and 3.15%. The values corre- 
 sponding to these rates are as follows : 
 
 3.10% $1,276,929.04 
 
 3.15% 1,257,990.62 
 
 1/5 of the difference being $3,787,684, we may roughly 
 estimate the intermediate values as follows : 
 
 3.11% $1,273,141.35 
 
 3.12% 1,269,353.66 
 
 3.13% 1,265,565.98 
 
 3.14%.. 1,261,778.30 
 
 The required rate must lie between 3.13% and 3.14%; 
 the difference in rates lies between .87% and .86%. Correct- 
 ing the above intermediate values by the colored pages in 
 the bond tables,* we have : 
 
 Premium at 3.13% $265,505.52 
 
 Premium at 3.14% 261,738.09 
 
 Premium at the required rate. . 264,806.66 
 
 Since any two premiums at the same income rate are 
 
 •Sprague's "Extended Bond Tables." 
 
222 PROBLEMS AND STUDIES 
 
 directly proportional to the difference between the cash and 
 income rates, we have the following proportions : 
 
 at 3.13%— $265,505.52 : $264,806.66 : : .87% : x% (x = .867/09998) 
 at 3.14% — $261,738.09 : $264,806.66 : : .86% ; x% (x = .870082484) 
 
 At the same premium on each bond ($264,806.66), we 
 see from the above two proportions that the following facts 
 prevail with reference to the rates : 
 
 Income Rate Cash Rate 
 
 3.13% corresponds with 3.997709998% 
 3.14% " " 4.010082484% 
 
 Our problem is to determine the income rate correspond- 
 ing with a cash rate of 4%, the premium still being the 
 same. For this purpose, the method of interpolation will be 
 sufficiently exact, and we may form a proportion as follows : 
 
 x% : .01% :: .002290002% : .012372486% 
 
 The unknown term of the proportion is found to be 
 .0018509%, which added to 3.13% gives 3.1318509% as 
 the income rate corresponding to a 4% cash rate. The ac- 
 curate value of the bond computed to ten decimal places at 
 the income rate of 3.131851% is $1,264,806.6645. 
 
CHAPTER XXIV 
 
 DISCOUNTING* 
 
 § 270. Table of Multiples 
 
 Discounting may be performed as well by multiplication 
 as by division, and multiplication is preferable as being the 
 more direct and compact process. In Table VI (§ 383) are 
 the reciprocals of all usual ratios of increase. Multiplying 
 by .9803921568, for example, will give the same result up 
 to a certain number of places, as dividing by 1.02. Using 
 the tabular plan, we have this table : 
 
 98 
 196 
 294 
 392 
 490 
 588 
 686 
 784 
 882 
 
 039 
 078 
 117 
 156 
 196 
 235 
 274 
 313 
 352 
 
 216 
 431 
 
 647 
 863 
 078 
 294 
 510 
 726 
 941 
 
 We will take as an illustration a 5% bond, yielding 4%, 
 both the coupons and the income being on a semi-annual 
 basis. The amounts receivable at maturity are $100,000.00 
 of principal and $2,500.00 of coupons, a total of 
 $102,500.00. The discounting process would then be as 
 follows : 
 
 In connection with text of § 143. 
 
 223 
 
224 PROBLEJMS AND STUDIES 
 
 102,500.00 
 
 98,039.22 
 
 1,960.78 
 
 490.20 
 
 100,490.20 
 2,600.00 
 
 102,990.20 
 
 98,039.22 
 
 1,960.78 
 
 882.35 
 
 88.24 
 
 .20 
 
 100,970.79 
 2,500.00 
 
 103,470.79 
 
 98,039.22 
 2,941.18 etc. 
 
 There is an error of 1 cent in the value 100,970.79 ; this 
 could easily have been prevented by carrying out into mills. 
 For long operations it is always advantageous to use a few 
 spare places beyond those retained in the final result. 
 
 § 271. Present Worths of Interest-DifiFerence 
 
 Still greater brevity will be attained by working out first 
 the items of amortization, or present worths of the difference 
 between the cash and income rates. The present worths of 
 the interest-difference 500 are obtained as follows, using 
 fewer figures and less labor than in the preceding example : 
 
DISCOUNTING 225 
 
 600.000 
 
 490. X9 6 % year before maturity 
 
 392.157 
 
 88.235 
 
 .098 
 
 .088 
 
 6 
 
 480.584 1 year before maturity 
 
 392.157 
 
 78.431 
 
 .490 
 
 .078 
 
 4 
 
 471.160 1% years before maturity 
 
 392.157 
 
 68.627 
 
 980 
 
 98 
 
 59 
 
 461.921 2 years before maturity 
 
 Writing these down in reverse order, the amortization 
 column of the schedule is filled : 
 
 461.92 
 471.16 
 480.58 
 490.20 
 
 1903.86 
 
226 PROBLEMS AND STUDIES 
 
 The value at two years before maturity is therefore 
 $101,903.86, and the schedule may be further filled : 
 
 
 Book 
 
 Par 
 
 Amortization 
 
 Value 
 
 Value 
 
 
 $101,903.86 
 
 $100,000.00 
 
 $461.92 
 
 101,441.94 
 
 
 471.16 
 
 100,970.78 
 
 
 480.58 
 
 100,490.20 
 
 
 490.20 
 
 100,000.00 
 
 
 For practice, any of the Problems (52) to (55), inclu- 
 sive, may be worked over backwards. 
 
 § 272. Discounts from Tables 
 
 If the rate is one of those embraced in Table II (§ 379), 
 and the difference of interest is a simple number, the process 
 is still easier. Here the present worths of 500 for various 
 numbers of periods at 2% per period are required. In Table 
 II we find these present worths for $1 ; pointing off 3 places 
 to the rig-ht gives the corresponding values for $1,000, and 
 halving this, all in the one operation, gives the successive 
 figures required : 
 
 4 periods .92384643X 1000 -^ 2 =461.9227|| 
 3 " .94232233 " 471.1612|| 
 
 2 " .96116878 " 480.6844|| 
 
 1 " .98039216 " 490.1961|| 
 
 1903.8644|I 
 
 § 273. Reussner's Tables 
 
 Reussner's "True Discount Tables" give multipliers for 
 each day, from 1 to 180, carried to 8 places, for a great 
 number of usu^l rates, and will much facilitate discounting 
 
DISCOUNTING 
 
 227 
 
 for fractional periods. In the example in the text, it gives 
 .99009901 opposite 90 days at 4%, with the following 
 result : 
 
 102,600.000 
 
 99,009.901 
 
 1,980.198 
 
 495.050 
 
 101,485.149, the same as in the text of § 144. 
 
CHAPTER XXV 
 
 SERIAL BONDS 
 
 § 274. Problem in Valuation of Serial Bonds 
 
 (64) A city issues ten 4% bonds for $10,000 each, A&O, 
 on April 1, 1914, maturing as follows : $10,000 on April 1, 
 1916; $10,000 on April 1, 1918, and so on— $10,000 each 
 alternate year, the last $10,000 on April 1, 1934. They 
 are sold at 108.33, the purchaser believing that he has a 
 3.10% investment. How near right is he? 
 
 As the average time of the bonds is 11 years, it might 
 be inferred that the true value of the series was the value 
 of a single bond of $100,000 due in 1925, which would be 
 $108,334.54; but this is fallacious. The true price, obtained 
 by adding together all the separate tabular values, is always 
 less. 
 
 At 3.10%, the values of the bond at varying due dates 
 are as follows : 
 
 Due Dates 
 
 Values 
 
 1916 
 
 $10,173.24 
 
 1918 
 
 10,336.13 
 
 1920 
 
 10,489.31 
 
 1922 
 
 10,633.35 
 
 1924 
 
 10,768.79 
 
 1926 
 
 10,896.16 
 
 1928 
 
 11,015.92 
 
 1930 
 
 11,128.53 
 
 1932 
 
 11,234.43 
 
 1934 
 
 11,334.01 
 
 Total series 
 
 $108,009.87 
 
 228 
 
SERIAL BONDS 
 
 229 
 
 It is evident that the purchaser should have paid 108.01 
 instead of 108.33, and that on the latter price he will earn 
 less than 3.10%. How much less, is to be ascertained. 
 
 The value at 3.10% might have been carried out further 
 in decimals to the limit of the tables, giving $108,009.8686. 
 
 The values at 3.05% will next be copied down. 
 
 
 Due Dates 
 
 Values 
 
 
 r 2 
 
 years 
 
 $10,182.9714 
 
 
 4 
 
 
 10,355.1945 
 
 
 6 
 
 
 10,517.3006 
 
 
 8 
 
 
 10,669.8840 
 
 3.05% 
 
 10 
 
 
 10,813.5041 
 
 Basis 1 
 
 12 
 
 
 10,948.6875 
 
 
 14 
 
 
 11,075.9297 
 
 
 16 
 
 
 11,195.6973 
 
 
 18 
 
 
 11,308.4294 
 
 
 20 
 
 
 11,414.5391 
 $108,482.1376 
 
 § 275. Inter-rates 
 
 The inter-rates, 3.06%, 3.07%, 3.08%, and 3.09%, can 
 now be obtained in bulk without determining the values for 
 separate years, according to the directions on page 123 of 
 Sprague's ^'Extended Bond Tables." 
 
 Find the difference between ,. .$108,482.1376 
 
 and ; 108,009.8686 
 
 which is ., $472.2690 
 
 ys of this is 94.4538 
 
 Subtracting from $108,482.1376 succes- 
 sively ys, }i, Ys, and fs , we have the 
 approximate values for 3.06% ... $108,387.6838 
 
 for 3.07% 108,293.2300 
 
 But it is unnecessary to go further ; it is evident that the 
 effective rate is a little below 3.07%. 
 
230 
 
 PROBLEMS AND STUDIES 
 
 § 276. Table of Differences 
 
 The value given at the basis of 3.07% is approximate, 
 and we can get a corrected value by applying the rule given 
 on page 122 of the tables,* viz. : ''To correct any terminal 
 2 or 7, subtract II/2 times the difference and then add 1/10 
 the sub-difference." The following table is derived from 
 pages 146 to 149, inclusive, of the bond tables,* and shows 
 the differences and sub-differences in the case of a 4% bond 
 of $1,000,000 at the income rates of 3.05% and 3.10%. 
 
 Dates of 
 
 Differences at 
 
 Differences at 
 
 Sub- 
 
 
 Maturity of Bond 
 
 3.05% Basis 
 
 3.10% Basis 
 
 Differences 
 
 
 2 
 
 years 
 
 $ .09 
 
 $ .09 
 
 
 
 4 
 
 
 .33 
 
 .33 
 
 
 
 6 
 
 
 .69 
 
 .69 
 
 
 
 8 
 
 
 1.17 
 
 1.16 
 
 $.01 
 
 
 10 
 
 
 1.74 
 
 1.73 
 
 .01 
 
 
 12 
 
 
 2.40 
 
 2.39 
 
 .01 
 
 
 14 
 
 
 3.14 
 
 3.12 
 
 .02 
 
 
 16 
 
 
 3.95 
 
 3.92 
 
 .03 
 
 
 18 
 
 
 4.82 
 
 4.78 
 
 .04 
 
 
 20 
 
 Total 
 
 5.74 
 
 5.68 
 
 .06 
 
 
 
 $24.07 
 
 $23.89 
 
 $.18 
 
 
 On account of the fact that each of the bonds in question 
 has the par of $10,000 and not $1,000,000, the tabular 
 difference for the rate 3.07% becomes $.2407, and the sub- 
 difference $.0018; 1% times the difference equals $.3611, 
 and 1/10 of the sub-difference is $.0002. The corrected 
 value at 3.07% therefore becomes : 
 
 Sprague's "Extended Bond Tables. 
 
SERIAL BONDS 
 
 $108,293.2300 — $.3611 + $.0002 = $108,292.8691 
 The residue to be eliminated is 37.1309 
 
 231 
 
 making the price paid $108,330.0000 
 
 § 277. Successive Method 
 
 The values at the basis of 3.07% must next be worked 
 out for each period down to the last maturity. 
 
 Value at April 1, 1914 $108,292.8691 
 
 X 1.01535 1,082.9287 
 
 541.4643 
 
 32.4879 
 
 5.4146 
 
 less 2,000.0000 
 
 Value at October 1, 1914, $107,955.1646 
 
 X 1.01535 1,079.5516 
 
 539.7758 
 
 32.3865 
 
 5.3978 
 
 less 2,000.0000 
 
 Value at April 1, 1915 $107,612.2763 
 
 X 1.01535 1,076.1228 
 
 538.0614 
 
 32.2837 
 
 5.3806 
 
 less 2,000.0000 
 
 Value at October 1, 1915 . . $107,264.1248 
 
 At April 1, 1916, 1918, etc., at intervals of two years, 
 the book value will be further diminished to the extent of 
 the principal of the bonds maturing at these respective dates. 
 
232 PROBLEMS AND STUDIES 
 
 § 278. Balancing Period 
 
 But it may be that balancing-period figures are wanted, 
 say J & J. In that case, the value on July 1, 1914, is half- 
 way between , $108,292.8691 
 
 and 107,955.1646 
 
 or $108,124.0168 
 
 with which we continue — 1,081.2402 
 
 540.6201 
 
 32.4372 
 
 5.4062 
 
 less 2,000.0000 
 
 Value at January 1, 1915 . . $107,783.7205 
 
 1,077.8372 
 
 538.9186 
 
 32.3351 
 
 5.3892 
 
 less 2,000.0000 
 
 Value at July 1, 1915 $107,438.2006 
 
 1,074.3820 
 
 537.1910 
 
 32.2315 
 
 5.3719 
 
 less 2,000.0000 
 
 Value at January 1, 1916. . $107,087.3770 
 
 § 279. First Payment in Series 
 
 We have now reached a point where a broken terminal 
 period occurs, as to the first $10,000 due April 1, 1916, 
 and we must follow the directions of § 88, with tfiis modifica- 
 tion: that the $10,000 and the remaining $97,087.38 must 
 be treated separately, the reason being obvious. 
 
SERIAL BONDS 
 
 233 
 
 $107,087.3770 
 Amount of principal due April 1 10,000.0000 
 
 Remainder ; $97,087.3770 
 
 The usual procedure — 
 
 970.8738 
 
 485.4369 
 
 29.1262 
 
 4.8544 
 
 $10,000 X .007675 (3 months) . . 76.7500 
 
 $98,654.4183 
 Income 2% on $90,000 
 
 1% on $10,000 = 1,900.0000 
 
 Value at July 1, 1916 $96,754.4183 
 
 This will exemplify the process when the principal of 
 one of the serial bonds is paid off. 
 
 § 280. Elimination of Residue 
 
 There is a residue of $37.1309 to be eliminated, for 
 which we shall use the third method. A total premium of 
 $8,330 is to be amortized, while the 3.07% basis will amor- 
 tize only $8,292.8691. The proportion is 8,330 -^ 8,292.8691 
 = 1.0044784. A table formed from this will give the fol- 
 lowing multiples : 
 
 1004478 
 
 2008957 
 3013435 
 4017914 
 5022392 
 6026870 
 7031349 
 8035827 
 9040306 
 
234 PROBLEMS AND STUDIES 
 
 The amortization at 3.07% for the fractional period and 
 the 4 full periods is as follows : 
 
 168.8523 (April 1 to July 1, 1914) 
 
 340.2963 
 
 345.5199 
 
 350.8236 
 
 332.9587 
 
 and as adjusted for elimination as follows, the eliminands 
 appearing in the top line and the eliminates in the bottom 
 line: 
 
 1688523 3402963 3455199 3508236 3329587 
 
 1004478 3013435 3013435 3013435 3013435 
 
 602687 401791 401791 502239 301344 
 
 80358 2009 50224 8036 20090 
 
 8036 904 5022 201 9040 
 
 502 63 199 36 502 
 
 23 87 
 
 1696084 3418202 3470671 3523947 3344498 
 
 As thus computed, the adjusted amounts of amortiza- 
 tion would be as follows : 
 
 April 1, 1914, to July 1, 1914 $169.61 
 
 July 1, 1914, to Jan. 1, 1915 341.82 
 
 Jan. 1, 1915, to July 1, 1915 347.07 
 
 July 1, 1915, to Jan. 1, 1916 352.39 
 
 Jan. 1, 1916, to July 1, 1916... 334.45 
 
 Total for 4% years $1,545.34 
 
 § 281. Schedule 
 
 The schedule will then be made up as follows to this 
 point : 
 
SERIAL BONDS 
 
 235 
 
 o 05 
 
 O tH 
 
 as 
 
 o 
 
 H 
 N 
 
 H 
 PS 
 O 
 
 < 
 
 O 
 
 W 
 .-1 
 
 W 
 u 
 
 CO 
 
 05 
 
 
 
 00 
 
 tH 
 U CO 
 
 tn "^ 
 
 O . >% 
 PQ ^ ^03 
 -^ »— .^ 
 
 C/} 
 
 o 
 o 
 
 o 
 o 
 
 o 
 
 €/9- 
 
 < Oh 
 \ — ; CO 
 
 :3 o 
 
 
 
 
 
 
 
 l-l 
 
 2 
 
 a 
 
 
 
 Pk 
 
 0^ 
 
 
 0^ 
 
 
 05 
 
 
 T-{ 
 
 
 m 
 
 
 Oi t^ tH CD 
 
 
 CO 10 lO- tH CO 
 
 B, 
 
 00 rH Oi rJ^ 
 
 CO <^ rH 1>- rH 00 
 
 nj 
 
 CO rH 00 ThI rH Ir- 
 
 m> 
 
 00" 00" ^-" J>^ i>^ 
 
 
 000000 
 
 
 tH rH rH rH rH 
 
 
 €€ 
 
 )■ 
 
 N 
 
 
 • rH oq Ir- Oi 
 
 *f C 
 
 
 CD 00 CO tH 
 
 S.2 
 
 
 Ci rH* i>^ Cq t:H 
 
 S rt 
 
 
 CD TJH ^ iO CO 
 
 < 
 
 
 rH CO CO CO CO 
 
 
 
 
 0^ 
 
 
 Oi 00 CO rH VO 
 
 
 CO rH Oi CD 10 
 
 ni 
 
 
 06 C^* 1>^ lO 
 
 -^ 
 
 
 CO lO iO -^ CD 
 
 
 00 CD CD CD iO 
 
 aJ*^ 
 
 
 ^^ T-i -rH T-i T-i 
 
 iz; 
 
 
 
 
 
 00000 
 
 
 
 00000 
 
 if 
 
 
 00000 
 
 
 00000 
 
 
 Oi 
 
 
 rH CN C^l C?^ rH 
 
 1— 1 
 
 <(-> 
 
 
 en 
 
 
 
 
 
 u 
 
 
 
 
 ,__, 
 
 
 
 
 
 a 
 
 
 
 
 TjT 10 CD 
 
 
 rH rH rH 
 
 
 Oi Oi OS 
 
 
 r- 
 
 < rH iH II 
 
236 PROBLEMS AND STUDIES 
 
 The premium is now $6,784.66, and the premium at 
 3.07% is $6,754.42, which we test as follows: 
 
 1.004478 
 X 675442 
 
 602687 
 
 70313 
 
 5022 
 
 402 
 
 40 
 
 Proof 678466 
 
 § 282. Uneven Loans 
 
 The terms of a series of bonds need not necessarily be of 
 like amount. Suppose the payments in the above example 
 were: 
 
 $10,000 in 1916 
 
 $20,000 in 1918 
 
 $30,000 in 1920 
 
 $40,000 in 1922 
 
 $100,000 
 and it were desired to find the value at 3.10% ; the process 
 would be : 
 
 $10,173.2358 $10,173.2358 
 
 10,336.1340 X 2 20,672.2680 
 
 10,489.3124 X 3 31,467.9372 
 
 10,633.3506 X 4 42,533.4024 
 
 Value of series $104,846.8434 
 
 The formation of the schedule would be precisely an- 
 alogous to that already given. 
 
SERIAL BONDS 
 
 237 
 
 § 283. Tabular Methods 
 
 Most serial bonds run by years, an equal amount being 
 payable annually. Where the rate is one ending in 5 or 0, 
 and the values for exact interest periods are required, not 
 for intermediate periods, a simpler process may be used, 
 copying values direct from the tables. For example, a series 
 of five 4% bonds of the par value of $1,000 each, J & J, 
 issued July 1, 1914, payable on each first of July, 1915 to 
 1919, is sold on a 3.50% basis. 
 
 Set down in two columns the first ten values from the 
 tables ; then add and subtract successively, as follows : 
 
 1/2 yr. $1002.457 
 
 1 yr. $1004.872 
 
 lYz 1007.245 
 
 2 1009.577 
 
 2% 1011.870 
 
 3 1014.122 
 
 31/2 1016.337 
 
 4 1018.513 
 
 4% 1020.651 
 
 5 1022.753 
 
 
 $5069.837 
 
 Jan. 1, 1915, $5058.560 
 
 1020.651 
 
 Jan. 1, 1916, $4037.909 
 
 1016.337 
 
 Jan. 1, 1917, $3021.572 
 
 1011.870 
 
 Jan. 1, 1918, $2009.702 
 
 1007.245 
 
 1022.753 
 
 $4047.084 July 1, 1915 
 
 1018.513 
 
 $3028.571 July 1, 1916 
 
 1014.122 
 
 $2014.449 July 1, 1917 
 
 1009.577 
 $1004.872 July 1, 1918 
 
 Jan. 1, 1919, $1002.457 
 
238 
 
 PROBLEMS AND STUDIES 
 
 § 284. Formula for Serials 
 
 The total value of an annual series may be obtained by 
 the following formula : 
 
 Let m be the number of different maturities and n the 
 number of the periods the last bond has to run. Let r, for 
 brevity, represent the ratio of increase, instead of 1 + i. 
 The powers of r are obtainable from Table I (§ 378), or by 
 logarithms. The principal of each bond being $1, the 
 formula would read : 
 
 ^^^ — /^2_f y7n K ^' X (c — i) 
 
 In the preceding example m^ 6,n = 10, r = 1.0175^ i = 
 .0175, c = .02, c — i = .0025. 
 
 From Table I* or from the "Extended Bond Tables"t : 
 
 1.03530625 
 
 1.18944449 
 
 1.18944449 
 
 .18944449 
 
 .03530625 
 
 .18944449 
 
 r^ 
 
 = 
 
 y5m = 
 
 ^10 _ 
 
 r^ = 
 
 ^10 = 
 
 Therefore : r'^ - 1 
 
 = 
 
 r'-l 
 
 = 
 
 ^2m_i 
 
 _ 
 
 {r'-l)r'' 
 
 
 
 = 
 
 ^2in _ 1 
 
 = n 
 
 .03530625 X 1.18944449 
 4.511139 
 
 4.511139 = .488861 
 
 (m— /o''^~x"^n ^^ *' == -488861 -^ .0175 = 27.93491 
 
 Value of series = 5 + (27.93491 X .0025) = 5.0698373 
 which is the result already obtained by addition. 
 
 This formula will seldom be of use except in the case of 
 a very complex rate not comprised in the tables. It will then 
 involve the computation of three powers of r by logarithms. 
 
 § 378. t Sprag ue's "Extended Bond Tables. 
 
SERIAL BONDS 239 
 
 § 285. Problems in Valuation of Serial Bonds 
 
 The following problems may be solved in either of the 
 ways discussed : 
 
 (65) A corporation issued a series of ten $1,000 bonds, 
 5%, M & N, on May 1, 1913, payable each May 1, 1921 to 
 1930. What is the value on a 3.60% basis : 
 
 (a) On May 1,1918? 
 
 (b) On July 1, 1918? 
 
 (c) On August 23, 1918? 
 
 (66) Find the values as above, but on a 4% basis. 
 
 § 286. Answers to Problems in Valuation of Serial Bonds 
 
 Problem (65) 
 
 (a) $10,897.40 
 
 (b) $10,962.79 flat. 
 
 (c) $11,019.45 flat. 
 
 Problem (66) 
 
 (a) $10,630.42 
 
 (b) $10,701.29 flat. 
 
 (c) $10,762.71 flat. 
 
CHAPTER XXVI 
 
 OPTION OF REDEMPTION 
 
 § 287. Method of Calculating Income Rate* 
 
 The rate of income on a bond subject to a right to redeem 
 at an earlier date than that of actual maturity and on pay- 
 ment of a premium, can be ascertained by means of tables. 
 Only the income which is certain must be calculated upon in 
 advance; hence there will always be a contingent profit 
 which may be realized. 
 
 For example, suppose the bond to be a 4%% one abso- 
 lutely due in 30 years but redeemable at 105 after 20 years; 
 issued 1905, redeemable 1925, payable 1935. 
 
 In order to determine where the redemption is a benefit 
 and where it is a disadvantage, we must suppose ourselves 
 to be in 1925 at the redemption date. This bond now has 
 10 years to run. Turning to the 4%% bond table,t under 
 10 years, we find that 1.05 is the price almost exactly at a 
 3.89% basis. Therefore, if the bond is bought now on a 
 3.89% basis, the investment value in 1925 will be exactly 
 1.05 and there will be neither profit nor loss in being re- 
 quired to surrender at 1.05; 3.89% may be called the 
 neutral rate. 
 
 § 288. Advantageous Redemption Ignored 
 
 It is necessary to bear in mind that the higher the rate 
 of income the lower is the premium ; if the rate be more than 
 
 • Compare § 147. 
 
 t Sprague's "Extended Bond Tables." 
 
 240 
 
OPTION OF REDEMPTION 241 
 
 3.89%, say 4%, the option may be disregarded, for we shall 
 surely have 4% for 20 years, and probably for the full time. 
 In case the rate of interest has fallen to 3.89%, the issuer 
 of the bond may think it advantageous to redeem, so as to 
 sell his new issue at more than .05 premium. Then, as our 
 bond stands at less than 1.05, we get a profit besides our 4% 
 income. Thus, if the bond is bought at a basis which yields 
 more than 3.89% for 30 years, we may safely amortize at 
 that basis for 20 years, or until the option is exercised. 
 
 § 289. Disadvantageous Redemption Expected 
 
 But if the rate for thirty years, which we may call the 
 apparent rate, or non-redemption rate, is less than 3.89%, 
 the bond will be worth more than 105 at the redemption date 
 and the issuer may be expected to redeem. If he does not, 
 it is because the general rate of interest has risen so that 
 he must pay more than 3.89%, in which case he will allow 
 us to continue at 3.89% till maturity. Thus, if the bond is 
 bought at a price which would be on an apparent basis of 
 less than 3.89%, redemption must be expected as being 
 adverse to our interests. The redemption date then becomes 
 the actual date of maturity, but the principal is not 1 but 
 1.05. 
 
 § 290. Change in Principal 
 
 Let the par be $100,000 and the price $114,423.38, which 
 is at the apparent basis of 3.70%. To get the actual basis 
 we must consider the par as $105,000 and the time 20 years. 
 But if the par is $105,000, the cost is not at 1.1442 1| but at 
 1.1442||-^1.05 = 1.0897||. The cash rate is also trans- 
 formed; the cash income is still $4,500, but this is not 4^2% 
 of $105,000 ; it is only 4 2/7%. 
 
 Therefore, the limitation imposed by the option of re- 
 demption entirely changes the problem. Instead of a 4%% 
 
242 PROBLEMS AND STUDIES 
 
 bond for $100,000, due in 30 years, bought at 1.1442, we 
 have a 4 2/7% bond for $105,000, due in 20 years, bought 
 at 1.0897. 
 
 No tables have been published for 4 2/7% bonds, presum- 
 ably because this exact case of 4%% bonds redeemable at 
 1.05 is infrequent. However, we can easily construct them 
 by adding to the value of a 4% bond, 2/7 of the difference 
 between a 4% bond and a 5% bond. 
 
 § 291. Approximate Location 
 
 As a rough approximation, find 1.0897 as closely as pos- 
 sible in the 20-year tables for 4% and 5% respectively. The 
 nearest to 1.0897 in the 4% table is 1.08655516, which is a 
 3.40% income; the nearest in the 6% table is 1.08623676, a 
 4.35% income. The required rate will be about 2/7 of the 
 distance between 3.40% and 4.35%. 
 
 4.35 — 3.40= .95 
 
 2/7 of .95 = .27 
 
 3.40+ .27 = 3.67 
 
 Therefore 3.67% is the approximate rate, and we might 
 begin testing with that rate. We notice, however, that the 
 approximations 1.08656|| and 1.08624|| are both short of 
 1.0897; hence, probably the rate will fall short of 3.67%, 
 and it will be easier to start with the tabular rate 3.65%. 
 In fact, had we gone a little further in decimals, using the 
 colored pages of differences and sub-differences in the bond 
 tables, we should have obtained the following values in the 
 4% table: 
 
 Income rate, 3.38%, 1.08960122 
 Income rate, 3.37%, 1.09112831 
 
 The rate nearest to 1.0897 in the 4% table is therefore 
 3.38%. Similarly, in the 5% table the nearest rate is 
 
OPTION OF REDEMPTION 
 
 243 
 
 4.33% . Taking 2/7 of the difference between these two rates 
 and adding this difference to 3.38%, gives 3.65% as the 
 approximate income rate. 
 
 4% table, 20 years 3.65% 1.0493748 
 5% " " " 3.65% 1.1904458 
 
 Difference .1410710 
 
 1/7 .0201530 
 
 2/7 .0403060 
 
 Add to 4% value 1.0493748 
 
 Giving 4 2/7% value 1.0896808 
 
 This value is very close to 1.0897. 
 
 Value of $105,000 at the same price. .$114,416.48 
 
 Actual price 114,423.38 
 
 Residue 6.90 
 
 This is the nearest approximation we can obtain without 
 using more decimals; therefore, 3.65% is the actual rate of 
 income for a 4%% bond redeemable at 1.05, 10 years before 
 maturity, if purchased at 114.42, 30 years before maturity. 
 
 In the diagram (page 244) the dotted line marked 3.70 is 
 the apparent course of a bond at 114.42, 30 years to run ; but 
 the option at 105 pulls it down to a 3.65 basis; during the 
 last 10 years it earns 3.89%, if not redeemed. The 4% line, 
 as it passes below the 105 point, is unaffected by the option 
 of redemption. The issuer would not redeem, at 105, a bond 
 whose value was less than 105. 
 
 To complete a schedule running from the date of issue 
 to that of redemption, we have the following data : 
 
 Par, $105,000. 
 
 Cash interest, semi-annually, $2,250, being at the rate of 
 4 2/7% per annum. 
 
 Net income, semi-annually, $1,916.25, being 3.65% per 
 annum on $105,000. 
 
244 
 
 PROBLEMS AND STUDIES 
 
 Difference of interest, $2,250 — $1,916.25 = $333.75. 
 
 Present worth of 20-year annuity of $333.75 each half- 
 year, $9,416.48. Present value of bond at 3.65%, 
 $114,416.48. Actual value, $114,423.38. Eliminand, 
 $6.90. 
 
 We might now proceed to amortize $114,416.48 down to 
 maturity. Each term would then have to be corrected to 
 eliminate the residue, $6.90. The multiplier for this pur- 
 pose would be : 
 
 9423.38 ^ 9416.48 = 1.00073276| | 
 
 But we may proceed in the other direction and discount 
 $333.75 at various dates ; this has the great advantage that 
 
 4.1S 
 
 ■ 
 
 
 
 
 
 Graphic Representation 
 
 OF THE Effect of aw 
 
 1.14 
 
 N 
 
 V 
 
 
 
 
 Optionai, Redemption Date 
 
 %.%» 
 
 • 
 
 N; 
 
 <; 
 
 ^ 
 
 '^K 
 
 
 t.ia 
 
 • 
 
 
 
 
 \ 
 
 *» 
 
 &.X1 
 
 t.xo 
 
 • 
 
 ^ 
 
 •^ 
 
 
 
 
 
 &.O0 
 
 i.oe 
 
 ^ 
 
 ^ 
 
 \ 
 
 ^ 
 
 v 
 
 
 
 
 t*7 
 
 
 
 
 > 
 
 \ 
 
 ^^"\^< ^\\ ' • 
 
 
 i.e< 
 
 X.05 
 
 1.04 
 
 • 
 
 
 
 
 
 
 
 vet 
 
 
 
 
 
 
 
 \^. 
 
 1*1 
 
 
 
 
 
 
 
 ^\ 
 
 VAR 1.©© 
 
 ...X. 
 
 -i-l. 
 
 JU 
 
 J. 
 
 Om 
 
 
 ....(.. . iS«i 
 
 o 
 
 &0 
 
 as 
 
 ao vsX 
 
 •Z^XUXBMXatK 
 
 
 SVX JL»«X> 
 
 Jkvm* 
 
 
 FAVASCS 
 
OPTION OF REDEMPTION 
 
 245 
 
 $333.75 may be first multiplied by 1.00073276, thus accom- 
 plishing the elimination process once for all. 
 
 $333.75 X 1.00073276 = $333.99456 
 This last is substituted as a base in place of $333.75, and 
 we proceed to discount, using the factor .982077093] |, which 
 is the reciprocal of the semi-annual ratio 1.01825, in the 
 tabular method : 
 
 $333.9946 
 
 294.6231 
 
 29.4623 
 
 2.9462 
 
 8839 
 
 884 
 
 6 
 
 $328.0084 % year before maturity 
 
 294.6231 
 19.6415 
 
 7.8566 
 
 79 
 
 4 
 
 $322.1295 1 year before maturity 
 
 etc. 
 
 § 292. Problems Involving Optional Redemption Dates 
 
 (67) If a 4% bond is redeemable 25 years before 
 maturity at 105, what is the neutral rate of income? 
 
 (68) If a bond reads at 4%, but the amount which will 
 be received is 1.05 of the nominal par, what is the actual 
 percentage of cash income ? 
 
 (69) A 50-year 4% bond is redeemable at 105 after 25 
 
246 PROBLEMS AND STUDIES 
 
 years. Find its actual income rate if bought at (a) 105, (b) 
 106, (c) 107, (d) 108, and (e) 109. 
 
 (70) A 30-year 5% bond is redeemable at 110 after 15 
 years. Find at what price it should be bought when issued 
 to pay (a) 3.90%, (b) 4.40%. 
 
 § 293. Rule for Determining Net Income 
 
 We are now prepared to formulate a rule for determin- 
 ing the net income yielded at a certain price, by a bond bear- 
 ing a certain par interest but subject to redemption at an- 
 other price, on the assumption that the right will be 
 exercised. 
 
 (1) Divide the nominal cash rate of interest by the re- 
 demption price per unit ; the quotient will be the actual cash 
 rate, consisting of a whole number and a fraction; e.g., 
 4y2%-^1.05 = 4 2/7%. 
 
 (2) Divide the purchase price by the same divisor, giv- 
 ing the actual purchase price per unit; e.g., 1.1442 -r- 
 1.05 ==1.0897. 
 
 (3) Select two different bond tables, one at a lower, 
 one at a higher cash rate than the actual rate obtained in 
 paragraph 1. These should be even rates, not fractional, 
 and 1% apart. Find the column for the number of years 
 before redemption; e.g., 4% and 5%, 20 years. 
 
 (4) In each of these columns find the nearest price to 
 the actual purchase price in paragraph 2 ; e.g., in 4% table, 
 1.08656; in 5% table, 1.08624. 
 
 (5) Set down the two rates of net income found op- 
 posite these values, and find their difference; e.g., inter- 
 rates, 4.35% and 3.40% ; difference, .95%. 
 
 (6) Take such a fraction of the difference as is shown 
 by the fractional part of the mixed number which represents 
 the actual cash rate; add the result to the smaller rate and 
 
OPTION OF REDEMPTION 
 
 247 
 
 the sum is, approximately, the desired yield; e.g., 2/7 X 
 .95 = .27 ; .27 + 3.40 = 3.67. 
 
 (7) Try the nearest rates from the table until one is 
 found which produces the desired price; e.g., 3.65 produces 
 1.08968. 
 
 § 294. Answers to Problems Involving Optional Redemp- 
 tion Dates 
 
 Problem (67) 
 
 3.69% + 
 Problem (68) 
 
 3 17/21%, or 3.80952% + 
 
 Problem (69) 
 
 (a) Between 3.77% and 3.78%; (b) 3.73%+; 
 (c) 3.69% ; (d) 3.63% ; (e) 3.57% + 
 Problem (70) 
 
 (a) 118.005676; (b) 109.042757 
 
CHAPTER XXVII 
 
 BONDS AT ANNUAL AND OTHER RATES 
 
 § 295. Standard of Interest 
 
 In popular usage and, in fact, in legalized usage, though 
 not from the mathematical standpoint, the interest on a 
 given principal is directly proportional to the time; that is, 
 iif the interest is six dollars on a hundred for a year, it 
 must for six months be three dollars, and for three months 
 one dollar and a half. These three rates are popularly re- 
 garded as identical, but actually they are very different. A 
 single standard should be preserved, and when in any prob- 
 lem "6 per cent" is once taken as meaning "3 per cent per 
 half-year," it must not be arbitrarily shifted to mean "1% 
 per cent per quarter," which is really "3.0225 per cent per 
 half-year." 
 
 If the ratio of increase or income yield be kept at the 
 same unvarying standard, the frequency of collection, or 
 cash payment, affects the value of the investment. To change 
 the coupon from half-yearly to quarterly, must necessarily 
 enhance the value of the annuity made up of the coupons. 
 The nearer any one of them approaches to the present, or 
 the less time one must wait for his money, the more nearly 
 is it worth its par ; while the present worth of the principal 
 remains the same, unless we vary the income yield. 
 
 § 296. Semi-Annual and Quarterly Coupons 
 
 A bond for $1,000,000, due in one year, bearing semi- 
 annual coupons at 6 per cent per annum, at a price to net 
 
 248 
 
BONDS AT ANNUAL AND OTHER RATES 249 
 
 21/2 per cent computed semi-annually (1%% per period), 
 is worth, according to all tables and computations (except 
 the fictitious one of "reinvestment" at an arbitrary 
 
 rate) $1,034,354.52 
 
 thus, 
 
 Present worth of first coupon, $30,000, 
 
 one period, 1%% ,. $ 29,629.63 
 
 Present worth of second coupon, $30,- 
 
 000, two periods, 114% 29,263.83 
 
 Present worth of principal, $1,000,- 
 
 000, two periods, 1%% 975,461.06 
 
 By the method in § 111 $1,034,354.52 
 
 Or, using the method in § 116, we should take the 
 
 nominal interest $30,000 
 
 subtract from it the effective interest. .: 12,500 
 
 and obtain the interest-difference $17,500 
 
 An annuity of $17,500, for two terms, at 
 
 1^A%, would be the premium. $34,354.52 
 
 The company issuing the bonds is willing in return for 
 certain concessions to make its interest payments quarterly. 
 How much would this add to the value of the bond, the in- 
 come yield being still 2% per cent on a semi-annual basis? 
 
 If the bond be made quarterly, the same cash is received 
 each half-year, but $15,000 of it is received three months 
 earlier than before. On this $15,000 the bondholder is en- 
 titled to only 3 months' interest, instead of 6 months, at 
 1%% per half-year; therefore, a quarter's interest on this 
 quarterly coupon must be deducted each half-year from the 
 entire interest earned. 
 
 We must be careful, however, to compute the interest cor- 
 rectly on this advanced coupon. It must be at .00623059, 
 
250 
 
 PROBLEMS AND STUDIES 
 
 not at .00625. Interest at a half-period is not half of the 
 .0125, but the square root of the ratio 1.0125, less the 1; 
 Vi.0125 = 1.0062305911, interest = .00623059. Otherwise 
 we should be using a higher rate than 1.0125 for the half- 
 year, nearly 1.01254. The interest to be deducted each half- 
 year is $15,000 X .00623059 = $93.46. The effective in- 
 terest is $12,500 — $93.46 = $12,406.54, and the interest- 
 difference $30,000 — $12,406.54 = $17,593.46. If we should 
 now consider each instalment of the annuity to be $17,593.46 
 instead of $17,500, we should have the premium for quarter- 
 ly coupons. Therefore, the two annuities (or, in other 
 words, the premiums) at any point must be to each other 
 as $17,593.46 : $17,500; or the ratio of the quarterly 
 premium to the semi-annual is 1.005340507. Hence the 
 multiplier .0053405 on page VII of Sprague's "Extended 
 Bond Tables.'' 
 
 In symbols, the income rate becomes (instead of i), 
 i — f (Vl + ^* — 1) and the interest-difference becomes (in- 
 stead of c — i)y c— [i — |(VlTT— 1)] =c — i+^ 
 (VTTl — 1), which divided by (c — i) gives the propor- 
 tion 1-f ^ (Vl + ^ — 1) ^ ^.^ ^^^ ^^^^ ^^^^^ 1.0053405. 
 c — i 
 
 The process of finding .0053405 may be briefly expressed 
 thus: 
 
 Rule : Divide a quarter's interest on a quarterly coupon 
 by the interest-difference. 
 
 The value of the bond when trimestralized (reduced to a 
 quarterly basis) is, therefore : 
 
 At semi-annual payments .$1,034,354.52 
 
 Added for quarterly coupon, 34,354.52 X 
 
 .0053405 183.47 
 
 Value trimestralized $1,034,537.99 
 
BONDS AT ANNUAL AND OTHER RATES 
 
 251 
 
 This may be tested by multiplying down to 
 maturity, 3 months at a time, viz. : 
 
 $1,034,537.99 X .00623059 + 6,M5.Y9 
 
 $1,040,983.78 
 — 15,000.00 
 
 $1,025,983.78 
 $1,025,983.78 X .00623059 + 6,392.48 
 
 $1,032,376.26 
 — 15,000.00 
 
 $1,017,376.26 
 $1,017,376.26 X .00623059 + 6,338.86 
 
 $1,023,715.12 
 — 15,000.00 
 
 $1,008,715.12 
 $1,008,715.12 X .00623059 + 6,284.88 
 
 $1,015,000.00 
 Final payment, 1,015,000.00 
 
 We will now take an example where the effective rate is 
 greater than the cash rate. A bond of $1000 at 4% (sem.), 
 due in ten years, is bought so as to give a net income of 5% 
 (sem.) ; what will be its value if trimestralized ? 
 
 The normal or semi-annual value is by all tables.. $922,054 
 
 The discount, -^-^ X ( '^ ,, } .,^ ^ , is 77.946 
 
 I V (1 + / 
 
 The multiplier* is 0248457 
 
 77.946 X .0248457, amount of added value, = . . .$1.93661 
 
 922.054 + 1.937 = 923.991 
 
 Spragrue's "Extended Bond Tables," page VII. 
 
252 
 
 PROBLEMS AND STUDIES 
 
 § 297. Shifting of Income Basis 
 
 This is the correct vakie, the income basis being un- 
 changed. But in some recent books we find the quarterly- 
 value io be stated as $921,683, which is a surprising result, 
 for we should not expect the value of the security to be 
 diminished by a more frequent interest-payment. The 
 trouble is, that the income basis has been suddenly shifted 
 from 4% semi-annual to 4% quarterly, and we are given 
 comparisons between the following values : 
 
 (a) At 4% semi-annual basis, coupon 5% semi-annual. 
 
 (b) At 4% quarterly basis, coupon 5% quarterly. 
 Whereas the value really desired is : 
 
 (c) At 4% semi-annual basis, coupon 5% quarterly. 
 
 In all the tables using the basis (b), the values below par 
 are all apparently diminished by frequency of payment. The 
 author's tables are computed on the semi-annual income 
 basis, though the coupons may be quarterly or annual. 
 
 § 298. Problems — Bonds at Varying Rates 
 
 (71) A 5% quarterly bond for $100,000 has 5 years 
 to run on a 4% semi-annual basis; what is its value? 
 
 (72) Ascertain the value of the same bond at 4I/2 years. 
 
 (73) Derive the 4% years' value from the 5 years, and 
 obtain the same value as in (72). 
 
 (74) Find the value of a 2% quarterly bond, 5 years to 
 run, which nets 1.80% semi-annually. 
 
 (75) Two issues of 20 year, 31/^ % bonds, each 
 $100,000, are offered; one with interest semi-annually at 
 95.29, the other quarterly at 95.38 ; find the better purchase. 
 
 (76) Which is the better purchase : 
 
 $1,000,000 4%' quarterly bonds, 10 years, at 
 
 104.33, or 
 $1,000,000 3% semi-annual bonds, 10 years, at 
 
 95.50? 
 
BONDS AT ANNUAL AND OTHER RATES 253 
 
 § 299. Answers to Problems — Bonds at Varying Rates 
 
 Problem (71) 
 
 $104,608.02 
 Problem (Y2) 
 
 $104,182.64 
 Problem (73) 
 
 Value at 6 years , $104,603.02 
 
 Of this $1,250 is payable in three 
 months. 
 
 Present worth at 4% semi-annually. . 1,237.69 
 
 The remainder $103,365.33 
 
 Produces income at .02 2,067.31 
 
 $105,432.64 
 Cash interest received 1,250.00 
 
 Value at 4% years > $104,182.64 
 
 An alternative solution for this problem, and the one 
 usually employed, is as follows : 
 
 Value at 5 years. $104,603.02 
 
 This multiplied by the quarterly effective 
 rate, .00995049 (which is the square 
 root of 1.02, less 1) gives 1,040.85 
 
 $105,643.87 
 Less quarterly coupon 1,250.00 
 
 Giving value at ^% years $104,393.87 
 
 This multiplied by .00995049 gives the next 
 
 quarterly income 1,038.77 
 
 $105,432.64 
 Less quarterly coupon. 1,250.00 
 
 Giving value at 4% years. ,. . ... . .. .$104,182.64 
 
254 
 
 PROBLEMS AND STUDIES 
 
 Problem (74) 
 
 $100,973.61 
 Problem (75) 
 
 The quarterly bonds. 
 Problem (76) 
 
 The semi-annual bonds. 
 
 § 300. Bonds with Annual Interest — Semi-Annual Basis 
 
 Bonds on which the interest is paid only once a year are 
 somewhat rarer than those where it is paid four times a 
 year; but, when they do occur, means should be provided 
 for ascertaining their value at any given rate reduced to the 
 standard of semi-annual income. This is somewhat easier 
 than finding the value of a quarterly bond on a semi-annual 
 income basis. 
 
 We may begin by a simple example using the discount 
 method, either by division or by multiplication, taking a 4% 
 annual bond yielding 3% semi-annually, 2 years to run, for 
 $100,000. 
 
 Beginning at maturity at par. .....' $100,000.00 
 
 and adding to it the annual coupon then due. . 4,000.00 
 
 $104,000.00 
 
 We discount this by dividing by the ratio, 1.015, 
 or, what is the same thing, multiplying 
 by its reciprocal, .98522167; $104,000 -f- 
 1.015 or X .98522167 = $102,463.05 
 
 This is the value, flat, 6 months before maturity. 
 If there were a -payment of interest at this 
 date we should add its value. But there is 
 none; hence we continue the process, $102,- 
 463.05 -^ 1.015 or X .98522167 = $100,948.82 
 
BONDS AT ANNUAL AND OTHER RATES 
 
 255 
 
 Here we add the coupon payable one year before 
 
 maturity 4,000.00 
 
 $104,948.82 
 
 We discount this for another half-year, $104,- 
 
 948.82 -^ 1.015. $103,397.85 
 
 and again, $103,397.85 ^ 1.015 $101,869.81 
 
 which is the value required. ' = 
 
 To test this, let us multiply down to maturity : 
 
 Value at 2 years $101,869.81 
 
 Income at 1%%, % year 1,018.70 
 
 509.35 
 
 Value at 1% years, flat , $103,397.86 
 
 No coupon. 
 
 Income at 1%%, % year 1,033.98 
 
 516.99 
 
 $104,948.83 
 Annual coupon paid 4,000.00 
 
 Value at 1 year .$100,948.83 
 
 Add 1/2 year's income, at 11/2% 1,009.48 
 
 504.74 
 
 $102,463.05 
 
 Add last % year's income, at 1%% • • 1,024.63 
 
 512.32 
 
 Total principal and interest $104,000.00 
 
 § 301. Annualization 
 
 We will now annualize the above process; that is, in- 
 stead of multiplying twice by 1.015, we will multiply once 
 by 1.030225, which is 1.015 X 1.015, or (1.015)^ 
 
256 PROBLEMS AND STUDIES 
 
 As before, beginning with $101,869.81 
 
 we multiply by 1.030225. 3,056.09 
 
 20.37 
 
 2.04 
 
 .61 
 
 $104,948.82 
 and subtract the coupon 4,000.00 
 
 $100,948.82 
 
 again multiply by 1.030225 3,028.47 
 
 20.19 
 
 2.02 
 
 .50 
 
 giving the same result $104,000.00 
 
 Thus, income has been received on all of the investment 
 outstanding at 1.5% per half-year, or at 3.0225% per year. 
 
 § 302. Semi-Annual Income Annualized 
 
 Suppose now that we take the case of an ordinary half- 
 yearly bond paying a cash interest of 2% twice a year, and 
 yielding 1.5% half-yearly, with the purpose of annualizing 
 in this case also. The ratio, when annualized, is the same 
 as before, 1.030225, but there are two semi-annual coupons 
 of $2,000.00 each, instead of the single annual coupon of 
 $4,000.00 as in the previous case. The first of these cou- 
 pons, if deferred to the end of the year, will increase at 
 
 the semi-annual ratio of 1.015 to $2,030.00 
 
 The second coupon remains 2,000.00 
 
 The entire cash interest, when concentrated at the 
 
 end of the year, is therefore equivalent to $4,030.00 
 
 The processes of multiplying down to maturity, using 
 both semi-annual and annual periods, are shown below side 
 by side, beginning with the value $101,927.19 found from 
 
BONDS AT ANNUAL AND OTHER RATES 
 
 257 
 
 tables or by computation. In a third column appears the an- 
 nuaHzed process in the case of a 4% annual coupon. In all 
 three cases, the net income is 1.5% per half-year, or its 
 equivalent, 3.0225% annually. 
 
 Cash Interest 
 2% PER Half- Year 
 
 Cash Interest 
 4% per Year 
 
 Ordinary Process 
 
 Annualized Process 
 
 Annualized Process 
 
 $101,927.19 
 
 1,019.27 
 
 509.64 
 
 $101,927.19 
 
 3,057.82 
 
 20.38 
 
 2.04 
 
 .51 
 
 $101,869.81 
 
 3,056.09 
 
 20.37 
 
 2.04 
 
 .51 
 
 $103,456.10 
 2,000.00 
 
 $101,456.10 
 
 1,014.56 
 
 507.28 
 
 ' 
 
 $102,977.94 
 2,000.00 
 
 $105,007.94 
 4,030.00 
 
 $104,948.82 
 4,000.00 
 
 $100,977.94 
 
 1,009.78 
 
 504.89 
 
 $100,977.94 
 
 3,029.34 
 
 20.20 
 
 2.02 
 
 .50 
 
 $100,948.82 
 
 3,028.47 
 
 20.19 
 
 2.02 
 
 .60 
 
 $102,492.61 
 2,000.00 
 
 $100,492.61 
 
 1,004.93 
 
 502.46 
 
 
 $102,000.00 
 
 $104,030.00 
 
 $104,000.00 
 
258 
 
 PROBLEMS AND STUDIES 
 
 § 303' Comparison of Annual and Semi-Annual Bonds 
 
 In each of these columns the proper principal is attained 
 at maturity, together with its accompanying interest, either 
 actual or annualized. Observing the first and second 
 columns, we see that a semi-annual 4% bond is effectively 
 a 4.03% annual bond, the net income in both cases being 
 3.0225% per annum. Comparing the second and third 
 columns, the point to be noted is that their chief difference 
 lies in the effective cash rates, one being 4.03% and the 
 other 4% ; in the semi-annual bond, annualized, the interest- 
 difference between the cash and income rates is 
 
 $4,030.00 — $3,022.50 = $1,007.50 
 In the annual bond, it is.. 4,000.00 — 3,022.50= 977.50 
 
 § 304. Finding Present Worth of an Annuity 
 
 These interest-differences, $1,007.50 and $977.50, are 
 important because (according to the second rule in Chapter 
 X) we have only to multiply these two interest-differences 
 by the present worth of an annuity of $1 for 2 periods at 
 3.0225%, in order to obtain the respective bond premiums. 
 We might find this present worth approximately from Table 
 IV* by interpolation between the 3% and 31/2% columns, 
 but a much more accurate result may be obtained by the 
 use of Table II*, where we can find the present worth of $1 
 for 4 periods at 1.015, which is exactly equivalent to the 
 present worth of $1 for 2 periods at 1.030225. 
 
 This value $ .94218423 
 
 must, according to Chapter V, be subtracted 
 
 from 1.00000000 
 
 and the remainder $ .05781577 
 
 must be divided by the income rate 030225 
 
 The quotient is $1.9128460 
 
 * In Chapter XXXII, 
 
BONDS AT ANNUAL AND OTHER RATES 
 
 259 
 
 which is the present value of an annuity of $1 for 2 periods 
 at 3.0225% per period. The foregoing is an application of 
 the two symbolic rules, D = 1 — p and P = D -v- 1. 
 
 In order to obtain the bond premiums, we must multiply 
 the above present worth by 1,007.50 in the case of the semi- 
 annual bond, and for the annual bond by 977.50. 
 Premium on semi-annual 
 
 bond $1.912846 X 1,007.50 = $1,927,192 
 
 Premium on annual bond 1.912846 X 977.50 = 1,869.807 
 
 These premiums agree perfectly with the values pre- 
 viously obtained otherwise,* viz. : $101,927.19 and $101,- 
 869.81. 
 
 As another example, take that of a 4% annual bond 
 yielding 5%, for two years. Evidently this will be at a 
 discount instead of at a premium. To annualize the ratio 
 1.025, multiply it by itself, giving 1.050625 ; the annualized 
 
 interest rate is therefore : . . .050625 
 
 from this subtract 04 
 
 giving as the interest-difference 010625 
 
 To find the present worth of an annuity of $1 for 2 (an- 
 nual) periods at 5.0625%, take from Table II,* column 
 2%%, the value for 4 (semi-annual) periods. .$ .90595064 
 subtract from 1.00000000 
 
 The compound discount is therefore $ .09404936 
 
 Divide by .050625 ; the quotient is $1.8577652 
 
 which is the required present worth of an an- 
 nuity of $1 for 2 periods at 5.0625%. 
 Multiply this by .010625; $1.8577652|| X 
 
 .010625 = $ .01973876 
 
 This is the discount, which, subtracted from par 1.00000000 
 
 gives the value of a $1 bond, $ .98026124 
 
 * In Chapter XXXII, 
 
26o PROBLEMS AND STUDIES 
 
 This may be tested by multiplying down to maturity : 
 
 X 1.025 .02450653 
 
 X 1.025 
 
 $1.00476777 
 .02511919 
 
 
 $1.02988696 
 .04 
 
 X 1.025 
 
 $ .98988696 
 .02474718 
 
 X 1.025 
 
 $1.01463414 
 .02536586 
 
 
 $1.04000000 
 .04 
 
 
 $1.00 
 
 § 305. Rule for Bond Valuation 
 
 We are now prepared to formulate a rule for valuing an 
 annual bond on a semi-annual basis without reference to 
 the values of a corresponding ordinary (or semi-annual) 
 bond. 
 
 Rule 1: 
 
 (a) Annualize the rate of interest (find the equivalent 
 annual income rate) ; e.g., 1.015^ = 1.030225. 
 
 (b) Subtract this rate from the annual coupon, or vice 
 versa, to give the interest-difference; e.g., .04 — .030225 = 
 .009775. 
 
 (c) Multiply the latter by the present worth of an an- 
 nuity of $1 for the number of annual periods at the an- 
 nualized rate, giving the premium or the discount; e.g., 
 .009775 X 1.9128453 = .0186981. 
 
 Where the values of the ordinary semi-annual bond 
 
BONDS AT ANNUAL AND OTHER RATES 261 
 
 have already been calculated, as in the bond tables, it will 
 be possible to obtain therefrom the values of the annual 
 bond, with a saving of time. 
 
 § 306. Multipliers for Annualizing 
 
 For each combination of a cash rate with an income rate, 
 a multiplier may be found which, applied to the premium or 
 the discount for any number of years on a semi-annual bond, 
 will give the depreciation caused by the collection of the 
 interest once a year only; and this multiplier will be con- 
 stant, whatever the time. A table of these multipliers will 
 be found in Spragne's "Extended Bond Tables," page VIII. 
 
 In the example given in § 300 we have a 4% annual 
 bond yielding 3% semi-annually. On page VIII* in the 
 column headed "4% Bond" on the line opposite "3%" is 
 the multiplier .0297767. The premium on the ordinary 
 semi-annual bond for $100,000 at 2 years, we have seen, is 
 $1,927.19. 
 
 $1,927.19 X .0297767 = $ 57.385 
 
 As the value, if semi-annual, would be. . . 101,927.192 
 the value of the annual bond is reduced to 101,869.807 
 
 In the example in § 304, the annualizer, or multiplier, for 
 a 4% bond to yield 5% is found from the table 
 
 to be ,. . .0493827 
 
 The value of a semi-annual bond of $1 at 2 
 
 years is $.98119013 
 
 or its discount is ,. 01880987 
 
 $.01880987 X .0493827 = 00092888 
 
 which subtracted from 98119013 
 
 gives the annualized value 98026125 
 
 This differs from the one already given 98026124 
 
 by 1 cent on a million dollars, owing to decimals having 
 been rounded off. 
 
 * Sprague's "Extended Bond Tables." 
 
262 PROBLEMS AND STUDIES 
 
 These multipliers are obtained by the following formula, 
 in which c and i represent the nominal rates per annum. 
 
 ci 
 
 (4 + i) (c-i) 
 
 § 307. Formula for Annualizer 
 
 The formula may be thus expressed as a rule. 
 Rule 2 : To find the annualizer for any two rates : 
 
 (a) Multiply the rates together for a dividend; e.g., 
 .04 X .03 = .0012. 
 
 (b) Multiply 4 + the income rate, by the difference of 
 rates for a divisor; e.g., 4.03 X .01 = .0403. 
 
 (c) Their quotient will be the required multiplier, or an- 
 nualizer; e.g., .0012 ^ .0403 == .029776675. 
 
 The product of the premium by the annualizer is always 
 subtracted from the semi-annual value; and sometimes the 
 resulting value may be shifted to a discount from a premium, 
 even if it was a premium which was extracted from the 
 table. Thus, in the case of a $1,000,000 5% annual bond, 
 payable in one year, netting 4.95%, the premium $482.03 X 
 the annualizer 1.22237313 = $589.22, and the value of the 
 annual bond becomes $999,892.81. 
 
 It must be observed that only values for full years can 
 be obtained in either of these ways. An odd half-year is a 
 "broken" period, and must be treated as in Chapter XL 
 
 § 308. Conventional Process 
 
 While the foregoing is the method which would doubt- 
 less be followed in buying and selling, a more accurate re- 
 sult, from a mathematical standpoint, would be obtained by 
 using as the half-year value the one found by multiplying 
 down at the effective rate. 
 
 Thus, in a bond at 4%, payable annually, on a 3% semi- 
 annual basis, the values are : 
 
BONDS AT ANNUAL AND OTHER RATES 263 
 
 2 years before maturity. . .$1,018,698.07 
 lyear " " ... 1,009,488.22 
 Maturity 1,000,000.00 
 
 The amortization for the first year is $9,209.85, and for 
 the second $9,488.22. Halving these severally, the values 
 by half-years appear as follows : 
 
 Values Di 
 
 2 years $1,018,698.07 $4,604.92 
 
 11/2 years 1,014,093.15 4,604.93 
 
 1 year 1,009,488.22 4,744.11 
 
 1/2 year 1,004,744.11 4,744.11 
 
 Maturity 1,000,000.00 
 
 § 309. Scientific Process 
 
 The foregoing result would be in accordance with the 
 conventionally established rule that during any period 
 (which is here a year) simple interest must prevail and the 
 amortization accrue proportionately to the time elapsed from 
 the beginning of the period. 
 
 But the half-year may, with equal propriety, be con- 
 sidered the period, since the income is on a semi-annual 
 basis. Under this assumption we must multiply down : 
 
 Value, 2 years $1,018,698.07 
 
 X 1.015 10,186.98 
 
 5,093.49 
 
 Value, 11/2 years $1,033,978.54 flat 
 
 Less accrued interest 20,000.00 
 
 Value, 11/2 years $1,013,978.54 and interest 
 
 Similarly, the value at one-half year is fixed at $1,004,- 
 630.54, and the series with differences will appear as 
 follows : 
 
264 PROBLEMS AND STUDIES 
 
 Values Di 
 
 2 years $1,018,698.07 $4,719.53 
 
 11/2 years 1,013,978.54 4,490.32 
 
 1 year 1,009,488.22 4,857.68 
 
 1/2 year 1,004,630.54 4,630.54 
 
 Maturity 1,000,000.00 
 
 In the second half of each year there is less amortization, 
 and consequently more earning than in the first half; but 
 this may be defended on the ground that by the conditions 
 prescribed, interest is compounded semi-annually. The 
 earning power at compound interest must continue to in- 
 crease until a cash payment; and there is no cash payment 
 at the mid-year. 
 
 § 310. Values Derived from Tables 
 
 This latter form of valuation at mid-years is recom- 
 mended for comparative (non-commercial) purposes. 
 
 The values at ^1/2 years, $1,004,630.54, $1,013,978.54, 
 etc., may be deduced from the ordinary extended tables by 
 multiplying by the annualizer, with this proviso : that the 
 interest-difference must first be temporarily added to the 
 tabular premium or discount before multiplying. Thus, in 
 the case just considered, the excess of .02 over .015 is .005 
 each half-year ; or, on $1,000,000, $5,000. 
 
 To find the value for 1% years, take from the 
 
 table the premium. . $14,561.00 
 
 add the interest-difference 5,000.00 
 
 giving the multiplicand $19,561.00 
 
 which, multiplied by the annualizer .9702233, 
 
 equals $18,978.54 
 
 from which again subtract. 5,000.00 
 
 giving the premium as above $13,978.54 
 
BONDS AT ANNUAL AND OTHER RATES 265 
 
 § 311. Successive Process 
 
 In general, when a schedule is to be formed for an an- 
 nual or a quarterly bond, on a semi-annual basis, it will be 
 found easier after ascertaining the initial value to multiply 
 down to maturity, as that will usually require fewer figures. 
 
 §312. Problems and Answers — Varying Time Basis 
 
 (Y7) $25,000 4% bonds, interest payable annually, 8 
 years to run ; what is the price at a 3.70% semi-annual basis? 
 
 (78) What multiplier will annualize the premium on 
 the above bonds as given in the regular bond table ? 
 
 (79) An offering is made of $30,000 31/2% bonds, in- 
 terest payable annually, of which $10,000 mature in one 
 year and $10,000 each year thereafter. What should be 
 paid for them to produce 3.40% semi-annually? 
 
 Answers : 
 Problem (77) 
 
 $25,452.30 
 Problem (78) 
 
 .8777970411 
 Problem (79) 
 
 $30,040.34 
 
 § 313. Bonds at Two Successive Rates 
 
 Occasionally bonds are issued with the agreement that 
 the interest paid shall be at a certain rate for some years, 
 and at another rate for the remainder of the time to maturity. 
 An example is a fifty-year bond bearing 4% for 20 years 
 and 5% for the following 30 years. The problem is then to 
 find the price at which they will pay a certain income, say 
 3.60%. 
 
 Each of the two successive cash rates will cause a 
 premium, and we may calculate these premiums separately. 
 
266 PROBLEMS AND STUDIES 
 
 § 314. Calculation of Immediate Premium 
 
 The premium caused by the 4% rate will last only 20 
 years and will then vanish ; hence, this premium is just the 
 same as that on a plain 4% bond for 20 years, netting 
 3.60%, which we find by calculation or from tables to be 
 $56,680.10 on $1,000,000. 
 
 §315. Calculation of Deferred Premium 
 
 The premium produced by the 5% rate does not take 
 effect immediately, but after 20 years. It is a deferred an- 
 nuity. An annuity for the entire 50 years of the excess in- 
 terest, 1.40%, or in other words the premium on a fifty 
 
 year 5% bond to net 3.60%, is $323,568.65 
 
 But during the first 20 years there will be no 
 such premium ; we have already charged that at 
 4%. Hence we must by subtraction eliminate the 
 analogous 5% premium for 20 years, which is 198,380.36 
 
 leaving a remainder $125,188.29 
 
 which is the premium, or present worth, of the enjoyment of 
 a 5% cash rate (as against a 3.60% income rate) commenc- 
 ing 20 years from date and continuing till 50 years from 
 date. 
 
 Adding together the two premiums, $56,680.10 and 
 $125,188.29, we have $181,868.39 as the premium which 
 should be paid for the bond. 
 
 A simpler way to apply the principle is to add together 
 
 the 4% value for 20 years $1,056,680.10 
 
 and the 5% value for 50 years 1,323,568.65 
 
 $2,380,248.75 
 and subtract the 5% value for 20 years 1,198,380.36 
 
 giving the value of the composite bond $1,181,868.39 
 
BONDS AT ANNUAL AND OTHER RATES 267 
 
 This procedure has the advantage that it applies alike to 
 bonds which are selling at a premium and to those which are 
 selling at a discount and automatically allows for that dis- 
 tinction. 
 
 §316. Symbols and Rule 
 
 We may for convenience represent the earlier rate by Ci 
 and the latter rate by C2, i being the net income. We may put 
 m for the number of years at which the rate Ci prevails, and 
 n for the number of years at C2; m + n is the entire time. 
 The rule will then be as follows : 
 
 Rule : To find the value of a bond to yield i per cent, 
 when by its terms it pays cash interest at the rate Ci for m 
 years and thereafter at Cz for n years, maturing in w + w 
 years. Add together the value of a Ci bond for m years 
 and that of a Cz bond for m-\- n years, and from the sum 
 subtract the value of a Cz bond for m years. 
 
 An example of a bond of very early maturity will il- 
 lustrate the principle of the rule and will admit of demonstra- 
 tion by multiplying down. A bond for $100,000 paying 
 5% for 1 year (2 periods) and 6% thereafter for 1% years 
 (3 periods) is to be valued so as to yield the annual return 
 of 4%. 
 
 § 317. Analysis of Premiums 
 
 If the rate on the bond were 5% for the entire 2% years, 
 its value, according to the bond tables,* would be 
 $102,356.73. On the other hand, if the rate were 6%, its 
 value would be $104,713.46. Let us analyze these premiums 
 into their component parts, which are the present worths of 
 excess interest for five periods, $500 per period in the case 
 of the 5% bond, and $1,000 per period in the case of the 
 6% bond. 
 
 Sprague's "Extended Bond Tables. 
 
268 
 
 PROBLEMS AND STUDIES 
 
 % year 
 
 1 year 
 
 Premium one year before maturity 
 1% years 
 
 2 years 
 2% years 
 
 5% 
 
 $490,196 
 
 480.584 
 
 6% 
 $980,392 
 961.168 
 
 $970.T80 J $1,941,560 
 
 471.161 
 461.923 
 452.866 
 
 942.322 
 923.846 
 905.732 
 
 Premium 2% years before maturity $2,356,730 $4,713,460 
 
 Any premium is the sum of a certain number of present 
 worths of $500 or of $1,000. But in the double-rate bond, 
 the only present worths that have an influence on the in- 
 augural value are the first two in the 5% column and the 
 last three in the 6% column, as indicated by the braces placed 
 opposite them. 
 
 It is evident that the values producing premiums at the 
 5% rate amount to $970.78, and that those in the 6% 
 column amount to $2,771.90 (the easiest way to obtain this 
 latter amount being to subtract $1,941.56 from $4,713.46). 
 Hence the premium is : 
 
 $970.78 + $2,771.90 = $3,742.68 
 
 The equivalent process by the rule would be : 
 
 Value of Cr bond, m years. . .$100,970.78 
 plus Value of d bond, m-\- n years 104,713.46 
 
 $205,684.24 
 less Value of Ca bond, m years. . . 101,941.56 
 
 $103,742.68 
 
 It will be interesting to multiply down to maturity and 
 thus test this result : 
 
BONDS AT ANNUAL AND OTHER RATES 269 
 
 $103,742.68 
 + 2,074.85 
 
 $105,817.53 
 
 — 2,500.00 
 
 $103,317.53 
 + 2,066.35 
 
 $105,383.88 
 
 — 2,500.00 
 
 $102,883.88 
 + 2,057.68 
 
 $104,941.56 
 
 — 3,000.00 
 
 $101,941.56 
 + 2,038.83 
 
 $103,980.39 
 
 — 3,000.00 
 
 $100,980.39 
 + 2,019.61 
 
 $103,000.00 
 
 — 3,000.00 
 
 'Par $100,000.00 
 
 It will sometimes be the case that in multiplying down 
 the values will increase for a time and then begin to de- 
 crease at the change of rate ; or vice versa, the values will at 
 first decrease and then later increase. 
 
270 PROBLEMS AND STUDIES 
 
 § 318. Problems and Answers — Successive Rates 
 
 (80) An issue of bonds matures on Jan. 1, 1966. In- 
 terest is to be at 6% till Jan. 1, 1936, and thereafter at Q'/o, 
 What is the price at a 3.60% basis on July 1, 1916? 
 
 (81) $10,000 of Waterworks Bonds, 5 years to run, 
 first 3 years at 4%, thereafter at 5%; find the value to 
 yield 4.40%. 
 
 (82) Find the value of the same bonds to net 4%%; 
 51/4%. 
 
 Answers : 
 Problem (80) 
 
 $1,413,422.66 
 Problem (81) 
 
 $9,988.49 
 Problem (82) 
 
 $9,824.98 ; $9,617.04 
 
CHAPTER XXVIII 
 
 REPAYMENT AND REINVESTMENT 
 
 §319. Aspects of Periodic Payment 
 
 When a loan is payable in equal periodic instalments, 
 each covering the interest and part of the principal, the 
 most obvious way of looking at it is that the principal is 
 gradually paid off; and then we have this aspect: 
 
 (1) A diminishing principal; 
 
 A diminishing interest charge, and therefore 
 
 An increasing repayment. 
 But precisely the same result may be obtained from a 
 different point of view by assuming that no payment is 
 made at all until the final date of maturity, at which time the 
 sinking fund, or sum of instalments plus interest, is just 
 sufficient to pay off the whole debt. In this case, we will 
 have the following aspect : 
 
 (2) An unchanged principal; 
 A uniform interest charge ; 
 
 A uniform instalment devoted to reinvestment and 
 allowed to accumulate. 
 As an illustration of the first aspect, suppose we consider 
 a debt of $1,000, bearing interest at 3% per period. This 
 debt may be extinguished in four periods by uniform instal- 
 ments of $269.03 at the end of each period, as we have 
 already pointed out in Chapter VII. For convenience, how- 
 ever, we again set forth the details on th^ following page : 
 
 271 
 
2^2 
 
 PROBLEMS AND STUDIES 
 
 Instalment 
 
 Interest 
 on Balance 
 
 Payment on 
 Principal 
 
 Principal 
 Outstanding 
 
 
 
 
 $1,000.00 
 
 (1) $269.03 
 
 $30.00 
 
 $239.03 
 
 760.97 
 
 (2) 269.03 
 
 22.83 
 
 246.20 
 
 514.77 
 
 (3) 269.03 
 
 15.44 
 
 253.59 
 
 261.18 
 
 (4) 269.03 
 
 7.85 
 
 261.18 
 
 0. 
 
 Total, $1,076.12 
 
 $76.12 
 
 $1,000.00 
 
 
 Here we see the diminishing principal, the diminishing 
 interest charge and the increasing repayment or amortiza- 
 tion. 
 
 From the reinvestment point of view, we have : 
 
 Instalment 
 
 Interest on 
 Entire Principal 
 
 Carried to 
 Sinking Fund 
 
 Principal 
 
 
 
 
 
 $1,000.00 
 
 (1) 
 
 $269.03 
 
 $30.00 
 
 $239.03 
 
 1,000.00 
 
 (2) 
 
 269.03 
 
 30.00 
 
 239.03 
 
 1,000.00 
 
 (3) 
 
 269.03 
 
 30.00 
 
 239.03 
 
 1,000.00 
 
 (4) 
 
 269.03 
 
 30.00 
 
 239.03 
 
 1,000.00 
 
 For 
 Reinvestment 
 
 Interest on 
 Previous Total 
 
 Total 
 Accumulated 
 
 (1) 
 
 (2) 
 (3) 
 (4) 
 
 $239.03 
 239.03 
 239.03 
 239.03 
 
 $ 7.17 
 14.56 
 22.15 
 
 $ 239.03 
 
 485.23 
 
 738.82 
 
 1,000.00 
 
 The amortization of principal in its two aspects as re- 
 payment and reinvestment should be carefully studied and 
 
REPAYMENT AND REINVESTMENT 273 
 
 the problems in connection with Chapter VII should be 
 worked over into schedule form in each aspect. 
 
 § 320. Integration of Original Debt 
 
 This principle will be found to hold : The "principal out- 
 standing" by the first method + the "total accumulated" by 
 the second method = the original debt. 
 
 The first point of view is based entirely on facts. With- 
 out regard to reinvestment, it is certain that the borrower 
 pays and the lender receives the exact rate of interest stipu- 
 lated for each period on the actual balance due at the be- 
 ginning of such period, and this balance may be represented 
 either by a single account or by a cost account and an 
 annulling account. 
 
 § 321. Use of the Reinvestment Point of View 
 
 There are some cases where, especially from the point of 
 view of the debtor, it is desirable to keep in view the entire 
 original sum. One of these cases is where it is impossible 
 or impracticable to diminish or pay off the debt before 
 maturity and where accumulation is the only method avail- 
 able. Another is that of a trust where there is an obligation 
 to keep the corpus of the fund intact, and consequently 
 reinvestment in some form is necessary. 
 
 But the calculations of reinvestment are hypothetical and 
 prospective. They have not the same actuality as those of 
 repayment, but are theoretical estimates of what is expected. 
 Unless a contract has been made to take the instalments ofY 
 one's hands at a fixed rate, the amount realized is pretty sure 
 to differ from the amount anticipated. 
 
 § 322. Replacement 
 
 There is a third method of considering periodic pay- 
 ments, which is not mentioned in the actuarial treatises,, and 
 
274 
 
 PROBLEMS AND STUDIES 
 
 which may be called replacement to distinguish it from re- 
 payment and reinvestment. The successive repayments are 
 transferred to new investments, which are not to accumu- 
 late but merely to furnish new income, helping out the 
 diminished income on the waning principal. We have out- 
 lined this procedure under "Bonds as Trust Fund Invest- 
 ments," in § 148 ; but for purposes of comparison we will 
 put the materials already used in § 319 into the replacement 
 form, assuming at first that replacements are so invested as 
 to earn exactly 3%. 
 
 1 
 
 Interest on 
 Principal 
 
 2 
 
 Payment on 
 Principal 
 
 3 
 
 Principal 
 Unpaid 
 
 4 
 
 Replace- 
 ment 
 
 5 
 
 Interest on 
 Replace- 
 ments 
 
 6 
 
 Total 
 
 Income 
 
 1+5 
 
 (1) $30.00 
 
 (2) 22.83 
 
 (3) 15.44 
 
 (4) 7.85 
 
 $ 239.03 
 246.20 
 253.59 
 261.18 
 
 $1,000.00 
 
 760.97 
 
 514.77 
 
 261.18 
 
 0. 
 
 $ 239.03 
 246.20 
 253.59 
 261.18 
 
 $ 7.17 
 
 14.56 
 22.15 
 
 $ 30.00 
 
 30.00 
 30.00 
 30.00 
 
 $76.12 
 
 $1,000.00 
 
 $1,000.00 
 
 $43.88 
 
 $120.00 
 
 Column 4 of replacements is not accumulative, as its in- 
 terest is not compounded, but is used as income, supplement- 
 ing that in Column 1. The balance of Column 3 plus the 
 total of Column 4 at any point make up $1,000. The two 
 corresponding amounts in Columns 1 and 6 always make 
 up $30 (Column 6). At the close, the original $1,000 has 
 been exactly replaced by the new securities. 
 
 § 323. Diminishing Interest Rates 
 
 As already remarked, it would seldom happen that 
 exactly 3% would be the rate secured for the replacements, 
 which ought to be of the same grade of security and avail- 
 ability as the original sum. Let us suppose that the rate of 
 interest was declining so that the first replacement had to 
 
REPAYMENT AND REINVESTMENT 275 
 
 be loaned at 2.95%, the second at 2.90%, and the third at 
 2.75%. Columns 5 and 6 are then the only ones changed: 
 
 5 
 
 Interest on 
 Replacements 
 
 6 
 
 Total 
 Income 1+5 
 
 $ 7.05 
 14.19 
 21.16 
 
 $ 30.00 
 29.88 
 29.63 
 29.01 
 
 $42.40 
 
 $118.52 
 
 Here we have the principal intact, and the falling-off is a 
 gradual one affecting the interest. If we had proceeded on 
 plan No. (2), the full predicted interest would have been 
 consumed, but the principal would have been impaired, which 
 is inadmissible. Hence, in cases of this kind, we must use 
 the vanishing principal with actual replacement. The re- 
 investment scheme is a basis of calculation only and cannot, 
 like the repayment plan, be reduced to practice. 
 
 § 324. Proof of Accuracy 
 
 It is interesting to note that in the repayment method 
 the work may at any point be tested by a fresh calculation, 
 showing the whole procedure to be coherent and consistent. 
 For instance, in our example, the principal at three periods 
 from maturity is $760.97. Treating this as the principal, 
 to find the sinking fund we divide $760.97 by 2.82861, just 
 as for 4 periods we divided $1,000 by 3.7171. This gives 
 $269.03 — the same result as before for the value of the 
 equivalent annuity; $22.83 as the interest ($760.97 X .03), 
 and $246.20 as the first repayment or the constant reinvest- 
 ment, in either aspect. 
 
2^6 PROBLEMS AND STUDIES 
 
 § 325. Varying Rates of Interest 
 
 It must not be supposed that there is at any one moment 
 a single rate of interest prevaiHng. Considerations of se- 
 curity, convenience, and availabihty give rise to different 
 grades of securities and different rates of interest. The 
 prudent investor will probably have at the same time some 
 capital out at high rates and some at low. The money at 
 high rates is not quite so secure, not quite so readily realiz- 
 able, and requires more effort for the collection of its in- 
 come. That at low rates is nearer to absolute freedom from 
 risk and from the labor of supervision; it almost automat- 
 ically collects its own income. The investor will have so 
 planned his investments as to endeavor to preserve a 
 judicious equilibrium between different grades of security, 
 and consequently of income. As his investments are liqui- 
 dated, he will try to maintain or improve this equilibrium, 
 and he will choose his reinvestments from a wide range, 
 some of low revenue but highest safety and others of the 
 contrary qualities. It is therefore fallacious to assume that, 
 as an author has said, "on the same day and under the same 
 circumstances money received from any one source may be 
 invested at the same rate as that received from any other 
 source." Theoretically it may be, but practically it will 
 usually be invested in the same grade of security as that 
 which it replaces. 
 
 § 326. Dual Rate for Income and Accumulation 
 
 When the lender assumes great risk, or when the supply 
 of loanable capital is temporarily deficient, he will exact very 
 high rates, or refuse to loan. Or he may require a high 
 rate and also demand that the instalments of repayment shall 
 be large enough to secure the higher rate on the entire 
 original loan until fully paid; while in ordinary reinvest- 
 ments a lower rate is easily obtained, 
 
REPAYMENT AND REINVESTMENT 
 
 277 
 
 § 327. Instalment at Two Rates 
 
 Suppose that $1,000 is loaned, repayable in 4 instalments, 
 on such a basis that the lender will have 5% interest per 
 period on the entire capital, while it will be replaced by 
 accumulating at 3%. 
 
 The sinking fund is exactly the same as in our previous 
 example, $239.03. But the instalment is : 
 
 not $30 + $239.03, or $269.03 
 but $50 + $239.03, or $289.03 
 
 The instalment here is as much greater as the interest is 
 greater. The accumulation is precisely the same as hereto- 
 fore. The instalment provides not only 5% on the money 
 remaining invested, but also 2% (unearned) on that which 
 had been repaid. 
 
 An instalment of only $282.01 would pay 5% on the 
 outstanding capital, which would gradually be replaced by 
 3% investments. Thus it is seen that the borrower has 
 to pay more than 5% ; in this instance about 6.( 
 
 § 328. Amortization of Premiums at Dual Rate 
 
 This loaning at a dual rate is of so little practical im- 
 portance, at least in this country, that it would not be worth 
 mentioning, except that a few writers have tried to apply 
 the same principle to the amortization of premiums. They 
 assume that there is no other way of ascertaining the value 
 of a bond than by laying aside the excess of interest and 
 letting it accumulate till maturity. But this is not at all 
 necessary. The question is, what uniform rate is yielded 
 by each dollar of the investment during the time it is out- 
 standing. When this is ascertained, it can make no differ- 
 ence what is done with the capital after it is returned. We 
 may as well say that the rate of a series of bonds payable 
 $1,000 each year and issued at par, cannot be determined 
 
2^8 » PROBLEMS AND STUDIES 
 
 until we Know at what rate the amounts were reinvested up 
 to the date of the last maturity. Reinvestment has nothing 
 to do with the yield of the original investment. Neverthe- 
 less, two authors have constructed tables based upon a dual 
 rate, one a rate of income, the other a rate of accumulation, 
 and they have taken the latter at the arbitrary figure of 4%, 
 irrespective of the grade of the bond. 
 
 § 329. Modified Method for Valuing Premiums 
 
 It is proper to give the method by which these results 
 seem to be obtained, or, at least, a method which will pro- 
 duce those results. 
 
 As a preliminary we will consider the valuation of a 
 premium in a slightly different way from any yet given. 
 
 We have seen that the premium on $1 is the present 
 worth (at the income rate) of the difference of rates. We 
 may modify this by saying that it is the difference of rates 
 (c — i) X the present worth of an annuity of $1 (P), 
 which may be found in Table IV.* But to multiply by P 
 is the same thing as to divide by 1 ^ P, or 1/P. Therefore, 
 another expression for the premium is (c — i)^(l/F). But 
 we found in § 90 that the rent (1/P) is the sum of the 
 sinking fund (1/A) and the single interest (i). There- 
 fore, we still further modify our expression: 
 Premium = (c — i) -^ (i + 1/A) 
 
 § 330. Rule for Valuation of a Premium 
 
 Rule: Subtract the income rate from the cash rate, and 
 use this as a dividend. Add the instalment from Table V* 
 to the rate of income, and this will be the divisor. The 
 quotient will be the premium. 
 
 Example : What is the premium on a 6% bond (semi- 
 annual) for $1, 50 years, yielding 6%? 
 
 In Chapter XXXII. 
 
REPAYMENT AND REINVESTMENT 
 
 279 
 
 c = .OS; i = .025 ; c — i= .005 (dividend) 
 
 1/A at 21/2%, 100 periods = .002312 (Table V*) 
 
 .025 + .002312 = .027312 (divisor) 
 
 Premium = .005 -^ .027312 = .18307 
 
 Value of bond, $1.18307 
 
 § 331. Computation at Dual Rate 
 
 To introduce the feature of an accumulative rate differ- 
 ing from the income rate, it is only necessary to change one 
 term in the above formula. The value of 1/A must be taken 
 from the column of Table V,* which represents the accumu- 
 lative rate, i remaining as the income rate. 
 
 Example : What is the premium on a 6% bond, as above, 
 yielding 5% on the entire investment to maturity, the 
 principal being replaced by a sinking fund at 4% ? 
 
 c — i = .03 — .025 = .005 (dividend) 
 
 1/A at 2% ='.003203 (Table V*) 
 
 i + 1/A = .025 + .003203 = .028203 (divisor) 
 
 .005 -^ .028203 = .17729 
 
 Value of bond = $1.17729, agreeing with Croad's 
 and Robinson's tables. 
 The constant income is .0294322 (i.e., 2%% of the value 
 of the bond), which subtracted from the cash received .03, 
 leaves as contribution to the sinking fund .0005678. At 4% 
 an annuity of .0005678 will amount in 50 years to .17729||, 
 as may be ascertained from Table III,* thus replacing the 
 premium. 
 
 § 332. Dual Rate in Bookkeeping 
 
 This form of valuation, which introduces an arbitrary 
 element, cannot be satisfactorily applied in the bookkeeping 
 processes of Chapter XVII. It is impossible to derive one 
 value from another consistently. The result will not agree 
 
 * In Chapter XXXII. 
 
228o PROBLEMS AND STUDIES 
 
 with a fresh calculation, and the profit or loss on a sale will 
 be distorted. Any intermediate value, as shown by the 
 actuaries, may have three different versions. 
 
 § 333* Utilization of Dual Principle 
 
 While tables on a fixed replacement rate are useless for 
 purchasing securities, the principle may occasionally be 
 utilized. Thus, the trustee referred to in § 148 may find 
 that it is impracticable to invest favorably such small 
 amounts as $400 or $500, and may conclude to deposit a 
 sinking fund in a savings bank where he may reasonably 
 expect that it will accumulate for the next five years at 
 3%%, or he may make a contract with a trust company on 
 the same terms. He may then decide also that it is better 
 for the beneficiary to receive a uniform income, rather than 
 one gradually decreasing. 
 
 At 13/4% per period, a sinking fund of $.092375 will, in 
 ten periods, amount to $1; therefore, by multiplication it 
 will take a sinking fund of $414,883 to accumulate to $4,- 
 491.29 in 10 periods. Out of the coupon of $2,500 must 
 be taken the instalment of $414.88, leaving for the bene- 
 ficiary a constant semi-annual income of $2,085.12, instead 
 of the $2,089.83 with which he would have begun on the 
 replacement plan, and which would have gradually fallen to 
 $2,079.82 for the last half-year. 
 
 § 334. Installation of Amortization Accounts 
 
 When the accounts of securities have once been estab- 
 lished on the plan of gradual extinction of premiums and 
 discounts, it is not difficult to take care of each new purchase 
 as it comes in, and to prepare its appropriate schedule, run- 
 ning if desired all the way to the date of redemption. When, 
 however, the accounts have been previously kept on the basis 
 of par or of cost, and it is desired to introduce investment 
 values instead- the task is much greater. 
 
REPAYMENT AND REINVESTMENT 281 
 
 § 335- Scope of Calculations 
 
 It might be supposed at first thought that it would be 
 necessary to start- the schedules back at the date of pur- 
 chase, but this is entirely unnecessary. For example, we find 
 a 5% bond for $100,000 which 20 years ago was bought for 
 $112,650, and which has still 10 years to run. At the date 
 of purchase it must have had 30 years to run. Turning to 
 any table of 5% bonds, 30-year column, we find that this 
 was (within 39 cents) a 4^4% basis. Turning to the 10- 
 year column, it appears that the value of a 5-year bond at 
 4l^% is $106,058.46. It is sufficiently accurate to begin 
 with this value, disregarding the 39 cents residue, although 
 that residue might be eliminated by the proportion, 
 12,649.61 : 6,058.46 :: 39 : 19 
 
 This would increase the present value to $106,058.65. 
 
 § 336. Method of Procedure when Same Basis Is Retained 
 
 So long as the same basis is preserved, any number of 
 intervening years may be disregarded. The following pro- 
 cedure may be recommended : 
 
 (1) Make an accurate list of the issues held, giving the 
 following particulars : dates of maturity; dates of purchase; 
 par value of each lot; cost of each lot, being at the rate of 
 $. . . . per $1,000 of par; rate of interest paid, and the in- 
 come basis when ascertained. Leave a column for valuation 
 at a date one period earlier than the proposed date of trans- 
 formation, 
 
 (2) Ascertain on what income basis each lot was bought. 
 This is done most easily by using the tables. In these and 
 the subsequent calculations it will be found advantageous to 
 use blank books and entrust nothing to loose papers. Head 
 each calculation with a statement of the problem which it 
 solves. Paper for these blank books, ruled with vertical 
 lineSj everj" third one of which is darker than the other two, 
 
282 PROBLEMS AND STUDIES 
 
 will much facilitate the work, and it is desirable to have the 
 pages numbered in a continuous series, for reference. 
 
 (3) Find the value of each lot at the initial date, which 
 is, as already stated, one period earlier than the date on 
 which the books are to be transformed to investment values. 
 
 (4) Where different lots of the same class have been pur- 
 chased at various dates and prices, their values at the various 
 bases on the initial date should be added together, giving a 
 composite value. Ascertain what is the income basis for 
 the time yet to run on this composite value. This basis is 
 the average basis for the remaining time of the bond. 
 
 (5) Having carefully verified all the initial values and 
 the effective rates, proceed to calculate the amortization and 
 accumulation of each class for one period, commencing a 
 schedule for each. The resulting values should be again 
 verified with care, these being the values with which the new 
 accounts will begin. 
 
 (6) Continue the calculations of successive values, carry- 
 ing them into decimals two places beyond the cents, ignoring 
 slight differences in the last figure. Copy the results, 
 rounded to the nearest cent, into the schedules, and complete 
 the latter. If time allows, it is advisable to calculate each 
 schedule to maturity, because no better proof of the correct- 
 ness of the entire chain of values can be had than the fact 
 that the bond reduces exactly to par at maturity. But if 
 time presses, only a few of the values may be calculated, 
 but the last one should be verified by some independent 
 method. It is well in this case to leave in the blank book 
 sufficient room to complete the calculations for each schedule. 
 A reference on the schedule to the page of the blank book 
 where the calculation is made, will be useful. 
 
 (Y) Make such entries as will place the ledger or ledgers 
 on the investment-value basis. 
 
Part III — Logarithms 
 
 CHAPTER XXIX 
 
 FINDING A NUMBER WHEN ITS LOGARITHM 
 
 IS GIVEN 
 
 § 337' Logarithmic Tables 
 
 The meaning and use of logarithms have already been 
 discussed in a general way,* and a simple three-figure, four- 
 place table of logarithms given (§43). The expression 
 "three-figure" refers to the number of figures in each of the 
 numbers of the table, and the expression "four-place" refers 
 to the number of decimals in each of the corresponding 
 logarithms. In the table given, for example, the logarithm 
 of 7.41 is shown to be .8698. 
 
 § 338. Discussion of Logarithms 
 
 As previously explained, every logarithm consists of the 
 characteristic, or whole number (which is frequently zero), 
 and a decimal fraction. Occasionally the decimal fraction 
 is zero, as in the case of the logarithms of .01, .1, 1, 10, 100, 
 etc. The decimal fractions which constitute that part of the 
 logarithm requiring tabulation are interminate ; that is, their 
 values may be computed to any desired number of decimal 
 
 See Chapter III. 
 
 283 
 
284 LOGARITHMS 
 
 places and the last place will still be inexact. Thus, the 
 logarithm of 2 to 20 places is .301 029 995 663 981 195 21+. 
 In a 4-place table, this would be rounded 
 
 off to 301 
 
 in a 7-place table, to 301 030 
 
 in a 10-place table, to 301 029 995 Y 
 
 in a 12-place table, to 301 029 995 664 
 
 The terminal decimal is never quite accurate, but is nearer 
 the true value than either the next greater decimal or the 
 next smaller one. Thus, the logarithm .8698 is nearer the 
 true logarithm of 7.41 than either .8699 or .8697. 
 
 §339- Standard Tables of Logarithms 
 
 The tables most in use, like those of Vega, Chambers, 
 and Babbage, are of five figures and seven places. A six- 
 figure table would have to contain ten times as many loga- 
 rithms as a five-figure table and, even though the number of 
 places were not increased, the space occupied would be ten 
 times greater than in the case of the five-figure table. In 
 the tables above mentioned, two figures in addition to the 
 five tabulated may be obtained by interpolation. 
 
 § 340. United States Coast Survey Tables 
 
 The tables of the United States Coast Survey have five 
 figures and ten places. Nine figures may be obtained by 
 simple proportion, but the tenth is, for most purposes, 
 unreliable. 
 
 It will, of course, be understood that the more decimal 
 places given in the tables, the more figures we can obtain 
 in the corresponding numbers, but the number of figures (in 
 the desired number) can never be more than the number of 
 places (in the corresponding logarithm). All of the fore- 
 going tables give auxiliary tables of proportionate parts or 
 differences* 
 
NUMBER FROM LOGARITHM 285 
 
 § 341. Gray and Steinhauser Tables 
 
 Tables of 24 and 20 places have been published by Peter 
 Gray and Anton Steinhauser, respectively, but the plan for 
 extending the number of figures is quite different from the 
 method of simple interpolation above referred to. Both of 
 these authors proceed on the plan of subdividing the number 
 into factors, and adding together the logarithms of those 
 factors. 
 
 §342 A Twelve-Place Table 
 
 For the accurate computation of problems in compound 
 interest, specially designed tables will be found in Chapter 
 XXX. A limit of twelve figures has been selected as the 
 most useful for this purpose. In the logarithms tabulated, 
 thirteen decimal places are given, the thirteenth place insur- 
 ing the accuracy of the twelfth figure of the corresponding 
 number, which would otherwise sometimes be 1, 2, or even 
 3 units in error, through the roundings being preponderant 
 in one direction or the other. 
 
 § 343. The "Factoring" Method 
 
 The method used in finding logarithms within the scope 
 of these tables, but not directly given in them, is that of 
 factoring, it being possible to construct the logarithm of any 
 number of twelve figures or less (999,999,999,999 in all) 
 by some combination of the 584 logarithms given in the 
 table of factors (§358). 
 
 Column A contains the logarithms of numbers of two 
 figures, 11 to 99, both inclusive, carried to thirteen places 
 of decimals. 
 
 Column B contains the logarithms of four-figure numbers 
 1.001 to 1.099, each beginning with 1. and one zero. 
 
 Column C contains the logarithms of six-figure numbers 
 J.QOOOl to 1.00099, each beginning with 1. and three zeroes. 
 
286 LOGARITHMS 
 
 Column D, 1.0000001 to 1.0000099, beginning with 1. 
 and five zeroes. 
 
 Column E, 1.000000001 to 1.000000099, beginning 
 with 1. and seven zeroes. 
 
 Column F, 1.00000000001 to 1.00000000099, beginning 
 with 1. and nine zeroes. 
 
 For example, opposite 34 in the table we find : 
 
 A .531 478 917 042,3 In . ., 3.4 
 
 B .014 520 538 757,9 In 1.034 
 
 C .000 147 635 027,3 In 1.00034 
 
 D .000 001 476 598,7 In 1.0000034 
 
 E .000 000 014 766,0 In 1.000000034 
 
 F .000 000 000 147,7 In . . ., 1.00000000034 
 
 By omitting all the prefixed zeroes, the printed table is 
 made very compact, each complete line across the table of 
 factors shown in § 358 containing only 57 figures instead of 
 82, as would otherwise be necessary. In using the tables 
 this must be taken into consideration, and accordingly it will 
 be understood hereafter that C 34, for example, means the 
 number 1.00034, and F 34 means 1.00000000034. 
 
 § 344. Finding a Number from Its Logarithm 
 
 In this process there are two stages : first, to divide the 
 logarithm into a number of partial logarithms taken from 
 those contained in the table of factors; second, to multiply 
 together the numbers corresponding to these logarithms. Of 
 course only the decimal part of the logarithm is used, and 
 the number has the position of its units figure determined 
 from the characteristic of the logarithm. 
 
 Let the logarithm .753 797 472 366,5 be one which 
 has been obtained as the result of an operation, and let the 
 corresponding number be required. Search in Column A 
 for the highest logarithm which does not exceed the given 
 
NUMBER FROM LOGARITHM 
 
 287 
 
 one. This is found to be .748 188 027 006,2, which stands 
 
 opposite 56. 
 
 Subtracting from ,. 753 797 472 366,5 
 
 A 56 .748 188 027 006,2 
 
 we have the remainder 
 
 This is smaller than any logarithm 
 in Column A. We search for it in 
 Column B and find opposite 13 
 precisely the same figures 
 
 5 609 445 360,3 
 
 6 609 445 360,3 
 
 These two logarithms added together make the given loga- 
 rithm ; hence the product of their numbers gives the number 
 required. 
 
 To multiply 56 by 1.013 : 
 
 56 
 1013 
 
 56 
 
 56 
 168 
 
 56728 
 
 1013 
 
 5065 
 6078 
 
 56728 
 
 This process may be greatly simplified as follows, plac- 
 ing the figures of the multiplier in vertical order at the side : 
 
 56 
 
 56 
 168 
 
 or 
 
 56 
 13 X 5 065 
 13 X 6 078 
 
 56728 
 
 56728 
 
 Notice that the first product is moved two columns to the 
 right of the multiplicand. 
 
 The column G used in the following example is not 
 given in the table of factors, but it is found by simply taking 
 the first two figures from E. The "G" number in this case 
 may be either 55 or 56, which may make the thirteenth 
 figure of the result doubtful, but probably not the twelfth. 
 
288 
 
 LOGARITHMS 
 
 Now take a larger logarithm .... 
 and continue the subtraction A 56 
 
 B13 
 
 C26 
 
 D29 
 
 E 58 
 
 F48 
 
 G55 
 
 753 911 659 107,4 
 748 188 027 006,2 
 
 5 723 
 5 609 
 
 632 
 445 
 
 101,2 
 360,3 
 
 114 
 112 
 
 186 
 901 
 
 740,9 
 
 888,7 
 
 1 
 
 1 
 
 284 
 259 
 
 852,2 
 452,2 
 
 
 25 
 25 
 
 400,0 
 189,1 
 
 210,9 
 208,5 
 
 2,4 
 2,4 
 
 (See Note 2*) 
 
 (See Note 1*) 2 
 6 
 
 (See Note 3*) 5 
 8 
 4 
 
 8 
 5 
 _5 
 (See Note 4*) 
 
 5600 
 56 
 168 
 
 567280000 
 113456 
 340368 
 
 5674274928000 
 
 * 
 
 11348550 
 
 5106847 
 
 5674291383397 
 
 • 283715 
 
 • 45394 
 
 • 2270 
 
 • 454 
 
 • 28 
 
 3 
 
 567429171526 
 
 " Qlj following page, 
 
NUMBER FROM LOGARITHM 289 
 
 Note 1 : The second multiplication jumps its right-hand 
 figure (6) four places to the right, which may be marked off 
 by four zeroes, or four dots. 
 
 Note 2 : Having extended the product to include the 
 13th figure, contraction begins in this multiplicand ; its first 
 figure used being the 7th (marked 'A') allowing for the 
 carrying from the 8th. Thus the starting point for this 
 multiplication is moved six places hack. 
 
 Note 3 : The multiplicand need no longer be extended, 
 as has been done at successive stages above, but remains the 
 same to the end. For convenience, dots may be placed in 
 advance under the first figure to be used in multiplication in 
 each line. 
 
 Note 4 : The thirteenth figures are added, but only used 
 for carrying to the twelfth. In this example the total of the 
 last column is 31, but it does not appear, except as con- 
 tributing 3 to the next column. 
 
 The dot below a figure indicates where the contracted 
 multiplication begins, all the figures to the right being 
 ignored, except as to their carrying power. 
 
 § 345. Procedure in an Unusual Case 
 
 Required the number for log. Oil 253 170 127. 
 
 In this example there is no suitable logarithm in A and 
 we must begin with B, as shown on page 290. 
 
 This example illustrates the procedure when B furnishes 
 the first logarithm. It also shows the convenience of using 
 paper ruled for the purpose. 
 
 In order to set down the partial products without hesita- 
 tion, remember the numbers 2, 4, 6. 
 
 In multiplying by B, the first figure of the product moves 
 two places to the right. 
 
 In multiplying by C, the first figure of the product moves 
 four places to the right. 
 
290 
 
 LOGARITHMS 
 
 1 — -.1 
 
 Formation of Number from Logarithm 
 
 Logarithm 
 A — 
 
 B26 
 
 C24: 
 
 D36 
 E63 
 F83 
 G67 
 
 
 
 1 
 
 1 
 
 2 
 
 5 
 
 3 
 
 1 
 
 7 
 
 
 
 1 
 
 2 
 
 7 
 
 
 
 
 1 
 
 1 
 
 1 
 
 4 
 
 7 
 
 3 
 
 6 
 
 
 
 7 
 
 7 
 
 5 
 
 8 
 
 
 
 
 1 
 1 
 
 
 
 
 5 
 
 4 
 
 8 
 2 
 
 
 1 
 
 9 
 
 8 
 
 3 
 1 
 
 5 
 
 7 
 
 1 
 
 
 2 
 
 
 
 
 
 
 
 1 
 1 
 
 5 
 6 
 
 9 
 6 
 
 1 
 3 
 
 1 
 4 
 
 8 
 5 
 
 1 
 
 7 
 
 2 
 3 
 
 
 
 
 
 
 
 
 2 
 
 2 
 
 7 
 7 
 
 7 
 3 
 
 2 
 6 
 
 3 
 
 
 9 
 5 
 
 
 
 
 
 
 
 
 
 
 3 
 3 
 
 6 
 6 
 
 3 
 
 
 4 
 5 
 
 
 
 
 
 
 
 
 
 
 
 
 2 
 2 
 
 9 
 9 
 
 A 
 B 
 
 26 
 
 C 2 
 4 
 
 D 3 
 6 
 
 E 6 
 3 
 
 F 8 
 3 
 
 G 6 
 7 
 
 1 
 1 
 
 
 0^ 
 
 2 
 
 6 
 
 2 
 
 
 4 
 
 6 
 
 1 
 
 * 
 
 2 
 
 
 4 
 
 — 
 
 — 
 
 — 
 
 
 1 
 
 
 
 2 
 
 6 
 
 2 
 
 4 
 
 • 
 
 6 
 
 • 
 3 
 
 2 
 
 
 6 
 
 4 
 
 7 
 1 
 
 8 
 5 
 
 7 
 
 7 
 
 3 
 
 4 
 
 9 
 
 8 
 
 1 
 
 • 
 
 
 
 • 
 
 2 
 
 • 
 
 6 
 
 • 
 
 2 
 
 • 
 
 4 
 
 9 
 
 9 
 
 3 
 6 
 
 4 
 1 
 3 
 
 4 
 5 
 
 
 8 
 
 8 
 7 
 7 
 2 
 3 
 
 7 
 5 
 9 
 1 
 1 
 6 
 1 
 
 1 
 
 
 
 2 
 
 6 
 
 2 5 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NUMBER FROM LOGARITHM 
 
 291 
 
 In multiplying by D, the first figure of the mtdtipliccmd 
 
 moves six places to the left. 
 The following rule may now be formulated for this 
 process. 
 
 § 346. Rule for Finding Number when Logarithm Is Given 
 
 (a) By successive subtractions separate the given loga- 
 rithm into a series of partial logarithms found in the 
 columns of the table of factors, setting opposite each its 
 letter and number. 
 
 (b) By successive multiplications find the product of all 
 the numbers thus found, allowing, in the placing of the 
 partial products, for the prefixed 1 and zeroes. 
 
 The work may be made to occupy fewer lines by setting 
 down the factors E, F, and G as one number at the top, 
 multiplying it by A, and incorporating it thereafter as one 
 multiplicand with the preceding figures. The result will 
 not be affected. Let the factors be, as in the first example : 
 A 56, B 13, C 26, D 29, E 58, F 48, and G 55. 
 
 E F G 
 
 584855 
 
 A 56 2924275 
 
 350913 
 
 5600000327519 
 
 B13 56000003275 
 
 16800000982 
 
 5672800331776 
 
 C26 1134560066 
 
 340368029 
 
 5674275259871 
 
 D29 11348551 
 
 5106848 
 
 5674291715270 
 
292 LOGARITHMS 
 
 Required the number whose logarithm is .6 or ^. 
 
 A 31 
 
 .500 
 491 
 
 000 000 000,0 
 361 693 834,3 
 
 B20 
 
 8 
 8 
 
 638 306 165,7 
 600 171 761,9 
 
 COS 
 
 38 134 403,8 
 34 742 168,9 
 
 D78 
 
 3 392 234,9 
 3 387 483,7 
 
 ElO 
 
 4 751,2 
 4 342,9 
 
 F94 
 G03 
 
 408,3 
 408,2 
 
 0,1 
 
 The resulting factors, A 31, B 20, C 08, D 78, E 10, 
 F 94, and G 03, when combined produce the result 
 3. 1622776601 7. The multiplication illustrates how 
 zeroes are treated when they occur in the multipliers. The 
 result is the square root of 10, to 12 places, as may be 
 demonstrated by multiplying 3. 16227766017 by itself. 
 
 § 347. Method by Multiples 
 
 In order to facilitate the multiplication of the factors, 
 A, B, C, etc., the table of multiples* (§361), giving the 
 product of each number from 1 to 9, by every number from 
 2 to 99, will be found convenient. Thus, the multiples of 
 89 read in one line as follows : 
 
 •Devised by Arthur S, Little. 
 
NUMBER FROM LOGARITHM 293 
 
 123456789 
 
 089 178 267 356 445 534 623 712 801 
 
 Then, if it be desired, for example, to multiply 68792341 
 by 89, we would select from the above table 
 under 6 5 3 4 
 
 8 712 
 
 7 623 
 
 9 801 
 
 2 178 
 
 3 267 
 
 4 356 
 
 1 089 
 
 6122518349 
 
 We have thus multiplied each figure of the multiplicand 
 by both figures of the multiplier, setting down each partial 
 product unhesitatingly. Three figures must be set down 
 for each partial product, even if the first be a zero. The 
 work may be made more compact by piling the partial 
 products like bricks, using only three lines : 
 
 5 3 4,8 1,3 5 6, 
 7 1 2,1 7 8,0 8 9 
 6 2 3,2 6 7, 
 
 6122518349 
 
 To use this method in combining the factors of a num- 
 ber, the letters A, B, C, etc., are written above alternate 
 figure spaces, which is facilitated by the use of paper properly 
 ruled. Then the first partial product under each letter is 
 placed with its middle figure under that letter at the top. 
 
 The following is an example of a combination already 
 performed in another form : 
 
294 LOGARITHMS 
 
 A B C D E F G 
 
 A 56 1 684856 
 
 2 8 0,4 4 8 
 4 4 8,2 8 
 
 2 2 4,2 8 
 
 56 327519 
 
 B 13 6 5 3 9,0 6 
 
 7 8 2 6,2 
 
 091 
 
 6672800331778 
 C26 13 0,0 5 2,0 0, 
 1 5 6,2 8,0 7 8 
 1 8 2,0 0,0 8 
 
 5674275259864 
 
 D 29 1 4 5,1 1 6,1 6 
 
 1 7 4,0 5 8,1 
 
 2 3,2 3 
 
 567429171526 
 
 A process* for verifying a numerical result, by using 
 a different set of factors in a second operation, is as follows : 
 
 Required the number corresponding to 
 .305 773 384 163,0 
 
 The factors are A 20, B 10, C 97, D 21, E 94, F 94, 
 and G 33 ; and the number is 2.02196383809. 
 
 In order to check the result and make sure of perfect 
 accuracy, we may solve the problem a second time, using a 
 smaller factor for A, provided the first remainder be less 
 than B 99, or .040997692423,5. Using A 19 instead of 
 A 20: 
 
 Suggested by Arthur S. Little. 
 
NUMBER FROM LOGARITHM 
 
 295 
 
 A 19 
 
 305 
 
 278 
 
 773 384 163,0 
 753 600 952,8 
 
 B64 
 
 27 
 26 
 
 019 783 210,2 
 941 627 959,0 
 
 C17 
 
 
 78 155 251,2 
 73 823 787,1 
 
 D99 
 
 4 331 464,1 
 4 299 494,1 
 
 E73 
 
 31 970,0 
 31 703,5 
 
 F61 
 G37 
 
 266,5 
 264,9 
 
 1,6 
 
 The new factors are A 19, B 64, C 17, D 99, E 73, F 61, 
 and G 37. 
 
 By multiplication, we obtain the same result as before : 
 
 A 19 
 
 B64 
 
 C17 
 
 D 99 
 
 
 7 361,37 
 6 625,233 
 
 19 
 11 
 
 13 986,60 
 4 839,2 
 76 65,9 
 
 202 
 
 160 014 881,7 
 20 216 001,5 
 14 151 201,1 
 
 202 
 
 194 382 084,3 
 
 1 819 749,5 
 
 181 974,9 
 
 202 196 383 809 
 
CHAPTER XXX 
 
 FORMING LOGARITHMS; TABLES 
 
 § 348. Explanation of Process 
 
 To form the logarithm of a given number — the table of 
 factors being used — ^two processes are necessary: first, the 
 number is separated into a series of factors corresponding to 
 the six columns of the thirteen-place table ; second, the loga- 
 rithms of these factors are taken from the table and added 
 together. 
 
 The factoring is effected by a progressive division, as 
 illustrated by the following simple example : 
 
 To find the logarithmic factors. A, B, C, etc., of 5.6728. 
 First extend the number to 12 places, 567 280 000 000. 
 The first factor. A, is always the first two figures of the 
 number itself. 
 
 A 56)56 7 2 80 000 000 (1.013 B 
 56 
 
 72 
 56 
 
 168 
 168 
 
 It will readily be seen that one 56 might have been 
 omitted. 
 
 A 56)7 280 000 000 (B 13 
 56 
 
 168 
 168 
 
 296 
 
FORMING LOGARITHMS 
 
 297 
 
 Turning then to the table, we have only to set down the 
 logarithms of these two factors : 
 
 A 56 nl 748 188 027 006,2 
 B 13 m/ 5 609 445 360,3 
 
 56728 nl 753 797 472 366 5 
 
 B 13 may be regarded as an abbreviation of 1.013. 
 
 In the next example a second divisor, at least, is required. 
 
 A 56) 7 42 9 17152 6 (B 13 
 56 
 
 182 
 168 
 
 AB56728)14 
 
 The second divisor is the product of A and B. It might 
 be obtained in either of three ways : 
 
 By multiplication 56 X 1.013 = 56728 
 By addition 56 
 
 + 56 
 
 + 168 
 
 56728 
 But the easiest way is 
 
 by subtraction 56742 (first five figures of the number) 
 — 14 (the remainder) 
 
 56728 
 
 This is the proper method for forming all divisors after 
 the first; that is, subtract the remainder from the original 
 number so far as used. 
 
 We resume the division, bringing down four more 
 figures, to the ninth inclusive : 
 
298 LOGARITHMS 
 
 AB ) 56728 )149171626(C26 
 113456 
 
 357155 
 340368 
 
 ABC ) 5674275) *1678726(D29 
 
 1134855 
 
 543871 
 510685 
 
 56742914 33186 (E 58 
 
 28371 
 
 4815 
 4539 
 
 276 (F 48, 7 
 
 227 
 
 49 
 45 
 
 The third divisor A B C is also formed by subtracting 
 from the number 5674291715 
 iiC the remainder 16 7 8 7 
 
 leaving 5674274928 
 
 As only six figures are needed for the divisor and 
 one additional figure for carrying, this is rounded up to 
 
 5 6 7 4 2 7,5 
 
 The fourth divisor is practically the number itself so far 
 as needed, and this lasts to the end. 
 
 The entire process is now repeated, but to insure greater 
 
FORMING LOGARITHMS 
 
 299 
 
 accuracy in the twelfth figure we will divide out to the 
 thirteenth : 
 
 A 56) 742 9 17152 6,0 (B 13 
 56 
 
 182 
 168 
 
 A B 56 728) 149 171 (C26 
 113456 
 
 357155 
 340368 
 
 A B C 56 742 749 28) 16 7 8 7 2 6,0 (D 29 
 (Contracted division begins here) 1 1 3 4 8 5 5,0 
 
 5 4 3 8 7 1,0 
 
 6 1 6 8 4,7 
 
 56 742 92) 3 3 18 6,3 (E 58 
 
 2 8 3 7 1,4 
 
 4 8 1 4,9 
 4 5 3 9,4 
 
 2 7 5,5 (F48 
 2 2 7,0 
 
 485 
 454 
 
 3 1 (G55 
 28 
 
300 LOGARITHMS 
 
 It remains only to add together the logarithms 
 A 56 (nl) 748 188 027 006,2 
 
 B 13 
 
 
 5 609 445 360,3 
 
 C 26 
 
 
 112 901 888,7 
 
 D 29 
 
 
 1259 452,2 
 
 E 58 
 
 
 25 189,1 
 
 F 48 
 
 
 208,5 
 
 G 65 
 
 
 2,4 
 
 567 429 171526 (nl) 753 911659 107 
 
 The figures in the thirteenth column are used only for 
 carrying to the twelfth column. 
 
 § 349. Rule for Finding a Logarithm 
 
 We may now formulate the following rule for finding 
 the logarithm : 
 
 (a) Fix the number at 13 figures, by adding ciphers or 
 cutting off decimals. 
 
 (b) Cut off the two left-hand figures by a curve, giving 
 A. 
 
 (c) Divide the next three figures by A, giving the two 
 figures of B, and a remainder. 
 
 (d) Form the second divisor A B, by subtracting the 
 remainder from the first five figures of the number. 
 
 (e) Bring down four more figures to the remainder and 
 divide by A B, giving the two figures of C and a remainder. 
 
 (f) Form the third (and last) divisor A B C by sub- 
 tracting the remainder from ten figures of the number. 
 
 (g) Divide the remaining figures by the third divisor. 
 As there are ten figures in the divisor and only eight in the 
 dividend, contraction begins immediately. Having obtained 
 the figures of D, the divisor for E, F, and G is simply the 
 number itself contracted. 
 
FORMING LOGARITHMS 
 
 301 
 
 (h) Write down the logarithms of A, B, C, D, E, and 
 F, obtained from the several columns of the table of factors ; 
 also that of G, being the first two figures of the correspond- 
 ing E. The sum will be the mantissa or decimal part of the 
 logarithm of the number, the thirteenth decimal place being 
 used for carrying only. 
 
 § 350. Examples of Logarithmic Computations 
 
 It is advisable, for the sake of both convenience and 
 accuracy, to make all of these logarithmic computations on 
 paper ruled with at least thirteen vertical lines, every third 
 line being darker than the other two. Space should be left 
 on either side of these lines for writing in the divisors and 
 quotients, and for such other arithmetical work as may be 
 necessary. As a rule, however, there would be few, if any, 
 additional arithmetical computations which would have to 
 be performed at the sides. 
 
 A few examples for practice are given below with the 
 factors and the solution : 
 
 56Y4=A 56 B 13 C 21 D 15 E 35 F 42 G 70 
 log. 5674=3.753 889 331458 
 38.8586468578 =A 38 B 22 C 58 D 31 E 39 F 02 G 25 
 log. do. =1.589 487 673 453 
 
 3.1415926535898+=A 31 B 13 C 41 D 16 E 33 F 11 G 91 
 log. do. =497 149 872 694 
 
 (This number is the ratio of the circumference of a circle 
 to its diameter. ) 
 
 1.02625=B 26 C 24 D 36 E 63 F 83 
 log. do. = .011 253 170 127 
 
 This number begins with an expression of the form B 
 (1.026), hence no division by A occurs. 1026 is the first 
 divisor. 
 
302 
 
 LOGARITHMS 
 
 B 1026) 2 5 C 24 
 
 2052 
 
 4480 
 4104 
 
 B C 102624624) 3 7 6 0,0 D 36 
 3 Y 8 Y 3,9 
 
 6 8 1 2 6,1 
 6 1 5 7 4,8 
 
 6 5 5 1,3 E 63 
 102625) 6 1 5 7,5 
 
 3 9 3,8 
 3 7,9 
 
 8 5,9 F 83 
 8 2,1 
 
 
 3,8 
 
 
 3,1 
 
 
 7 G 
 
 B26 
 
 Oil 147 360 775,8 
 
 C24 
 
 104 218 170,0 
 
 D36 
 
 1 563 457,3 
 
 E63 
 
 27 360,6 
 
 F83 
 
 360,5 
 
 G70 
 
 3,0 
 
 70 
 
 log. 1.02626 = .011253 170 127* 
 
 § 351. Logarithms to Less Than Twelve Places 
 
 The table of factors may be cut down to any lower num- 
 ber of places. In the example in § 348 it may be required 
 
 * This result will be found also in the Table of Interest Ratios, but even 
 more extended. 
 
FORMING LOGARITHMS 
 
 303 
 
 to give 9 places only, the tenth being used for carrying. We 
 cut down the original logarithm to ten figures, with a comma 
 after the ninth,, and it becomes : 
 
 A 56 
 
 753 911 659,1 
 748 188 027,0 
 
 B 13 
 
 5 723 632,1 
 5 609 445,4 
 
 C 26 
 
 114 186,7 
 112 901,9 
 
 D 29 
 
 1 284,8 
 1 259,5 
 
 E 58 
 F 24 
 
 A 
 
 B 1 
 3 
 
 26,3 
 25,2 
 
 1 
 
 56 
 56 
 168 
 
 C 2 
 6 
 
 567280000 
 113456 
 3 4 3 6,8 
 
 D2 
 
 9 
 
 E 5 
 
 8 
 F 2 
 
 56742749 2,8 
 
 1 1 3 4,9 
 
 610,7 
 
 2 8,4 
 
 4,6 
 
 1 
 
 56742917 1,4 
 
 The number is slightly in error in its tenth place, but 
 correct to the ninth. 
 
304 
 
 LOGARITHMS 
 
 § 352. Tables with More Than Twelve Places 
 
 If a table of factors for 18 or some other number of 
 places should hereafter be prepared, the methods which have 
 been explained would be applicable to the new table. 
 
 § 353- Multiplying Up 
 
 Another method for obtaining the factors of the number 
 in forming its logarithm* proceeds by multipHcatioa instead 
 of division, the latter operation being notably the more 
 laborious. The number, at first taken as a decimal less than 1, 
 is successively multiplied up to produce 1.000,000,000,000,0 
 and these multipliers are the A, B, C, D, E, F, and G, whose 
 logarithms added together make the cologarithm, or loga- 
 rithm of the reciprocal, from which the logarithm is easily 
 obtained. 
 
 § 354. Process of Multiplying Up 
 
 A is a number of two figures, a little less than the 
 reciprocal of the number, which will be called the sub- 
 reciprocal of its two initial figures. A table of sub-reciprocals 
 is given in § 360. The number multiplied by A will always 
 give a product beginning with 9. B is always the arithmetical 
 complement of the two figures following the nine, or the 
 remainder obtained by subtracting those two figures from 
 99. Multiplication by B will usually give a result beginning 
 with 999. C is the next complement and gives five 9's, 
 999,99. D similarly brings 999,999,9**,***,*. No further 
 multiplication is necessary, after D has been used as a factor ; 
 the six figures in the places of the asterisks are the comple- 
 ments of E, F, and G. 
 
 To illustrate, let it be required to obtain the logarithm 
 to the 12th place of .314 159 265 359 0. The object is to 
 multiply .314 159 265 359 up to 1.000 000 000 000 0. The 
 
 ♦ guggested by Edward S. Thomas of Cincinnati, 
 
FORMING LOGARITHMS 
 
 305 
 
 first step is to find the sub-reciprocal of 31, or A. Turning 
 to the table of sub-reciprocals, opposite 31 we find 31, by 
 which we multiply. 
 
 A 31 
 
 99 — 73 = 26 
 B 26 is therefore 
 the next multipli- 
 er; dropping the 
 last two figures 
 
 (99—21) C 78 
 
 (99—43) D 66 
 
 .3 141592653590 
 
 .9 424777960770 
 314159265359 
 
 .9 738937226129 (One nine secured) 
 
 194778744523 
 58433623357 
 
 .9992149594009 (Three nines secured) 
 
 6994504716 
 799371968 
 
 .9999943470693 (Five nines secured) 
 
 49999718 
 5 9 9 9 9 6 6 
 
 (99—47) E 52 
 
 (99—03) F 96 
 
 (100—77) G 23 
 
 A 31 nl 
 B 26 
 C 78 
 D 56 
 E 52 
 F 96 
 G 23 
 
 colog. 
 log. 
 
 .9999999470377 (Seven nines secured) 
 
 52 
 96 
 23 
 
 .4913616938343 
 
 111473607758 
 
 3386176522 
 
 24320423 
 
 225833 
 
 4169 
 
 10 
 
 0.50285012 7306 
 f. 4 9 7149872694 
 
3o6 LOGARITHMS 
 
 § 355' Supplementary Multiplication 
 
 It may happen, in the course of multiplication, that the 
 complement of the figures following the 9 does not suffice 
 to secure two nines more. In this case, another supple- 
 mentary multiplication must take place. I'his occurs in the 
 following example, which has already been solved in § 348. 
 
 Required the logarithm of the number 
 .567 429 171 526 
 
 In this example the C multiplication also requires an ad- 
 ditional figure. This seldom occurs. 
 
 .567 429 171526 
 A 17 .397 200 420 068 2 
 
 
 .964 629 591594 2 
 
 B 35 
 
 28 938 887 747 8 
 
 
 4 823 147 958 
 
 
 .998 391 627 300 
 
 B 01 
 
 998 391 627 3 
 
 
 .999 390 018 927 3 
 
 C 60 
 
 599 634 0114 
 
 
 .999 989 652 938 7 
 
 C 01 
 
 9 999 896 5 
 
 
 .999 999 652 835 2 
 
 D 03 
 
 299 999 9 
 
 
 .999 999 952 835 1 
 
 E 47, F 16, G 49 
 
 47 164 9 
 
 A 17 
 
 230 448 921 378 3 
 
 /B 35 
 I 01 
 
 14 940 349 792 9 
 
 434 077 479 3 
 
 C 60 
 
 260 498 547 4 
 
 01 
 
 4 342 923 1 
 
 D 03 
 
 130 288 3 
 
 E47 
 
 20 411 8 
 
 F 16 
 
 69 5 
 
 G 49 
 
 21 
 
 colog. 
 
 .246 088 340 892 7 
 
 log. 
 
 1.753 911 659 107 3 
 
FORMING LOGARITHMS 
 
 307 
 
 As the multiplication by B 35 brings only 998 instead of 
 999, we multiply again by B 01, which brings it up to 999-h. 
 
 In the next example there is a large defect in the product 
 obtained by multiplying by B 85, which requires an addi- 
 tional multiplication by B 7. 
 
 
 110 175* 
 
 A 83 
 
 881 400 (83, sub-reciprocal of 11) 
 33 052 5 
 
 B 85 
 
 914 452 5 
 73 156 200 
 4 572 262 5 
 
 B 07 
 
 992 180 962 5 
 6 945 266 737,5 
 
 C 87 
 
 999 126 229 237,5 
 
 799 300 983,4 
 
 69 938 836,0 
 
 D45 
 
 999 995 469 056,9 
 
 3 999 981,9 
 
 499 997,7 
 
 E 30, F 96, G 35 
 
 999 999 969 036,5 
 30 963,5 
 
 A 83 
 B 85 
 B 07 
 C 87 
 D45 
 E 30 
 F 96 
 G35 
 
 919 078 092 376,1 
 
 35 429 738 184,5 
 
 3 029 470 553,6 
 
 377 671 935,8 
 
 1 954 320,8 
 
 13 028,8 
 
 416,9 
 
 1,5 
 
 colog. 
 
 .957 916 940 818 
 
 log. 
 
 1.042 083 059 182 
 
 *The number no 175 was purposely selected, very slightly in excess of the 
 highest number in column B, so as to produce the shortage of 7. 
 
2o8 LOGARITHMS 
 
 § 356. Multiplying Up by Little's Table 
 
 .137 128 857 423 9 
 
 A 71 710 715 682 846 4 (71 being the 
 213 142 355 142 sub-reciprocal 
 
 49 756 849 721 3 of 13.) 
 
 .973 614 887 709 7 
 
 B 26 23 415 620 818 2 
 
 1 820 262 080 
 
 078 104182 2 
 
 .998 928 874 790 1 
 B 01 998 928 874 8 
 
 .999 927 803 664 9 
 C 07 69 994 946 3 
 
 
 .999 997 798 6112 
 
 D 22 
 
 19819818 
 
 
 198 198 
 
 
 19 815 4 
 
 
 .999 999 998 606 4 
 
 
 01 393 6 
 
 
 EFG 
 
 A 71 
 
 851 258 348 719 1 
 
 B 26 
 
 11 147 360 775 8 
 
 B 01 
 
 434 077 479 3 
 
 C 07 
 
 30 399 549 8 
 
 D 22 
 
 955 446 8 
 
 E 01 
 
 434 3 
 
 F 39 
 
 169 4 
 
 G 36 
 
 16 
 
 862 871 142 576 1 
 
 .137128 857 423 9 
 which is the log. of 1.371 288 574 239 
 
FORMING LOGARITHMS 309 
 
 In the preceding example, Little's table of multiples 
 (§ 361) is used in the multiplication. It will be found that 
 the logarithm when computed has the same figures as the 
 number itself — a remarkable peculiarity which no other com- 
 bination of figures can possess. 
 
 § 357- Different Bases 
 
 Ten is the base of the logarithmic system which we 
 have been explaining; it is the most useful of all systems, 
 because ten is also the base of our numerical system. These 
 are usually called common, or vulgar, or Briggsian loga- 
 rithms, but decimal logarithms would seem a more appro- 
 priate name. 
 
 Any number might form the base of a system of loga- 
 rithms, but the only other in actual use is one known as 
 the "natural" system, having for its base the number 
 2.718281828459+, known to mathematicians as e, which is 
 the sum of the series, 
 
 1+ 1 + -I_ + ___! + 1 + 
 
 ■^1^1X2^1X2X3^1X2X3X4^ 
 
 1 
 
 etc. 
 
 1X2X3X4X5 
 This is only used in theoretical inquiries, and is seldom 
 of utility to the accountant. 
 
3IO 
 
 LOGARITHMS 
 
 ^ Cq CO "^ 
 
 o o o o 
 
 vo vo t^ 00 0\ 
 
 o o o o o 
 
 O'-«CMC0»^ u-)VOt^00O\ 
 
 O '-' C^ f^ Tf 
 CVl CN> CM OJ CV| 
 
 feo 
 
 CO r>.^ P^ "^^ fN.^ l-H Tf tV.^ 
 
 Tl-" cd~ CO tC T-T vo 0~ Tf 0\ fO t^ CM VO o 
 
 oooo ooooo ooooo 
 
 ^ "^^ *^. '~L ^ °o ^ ^ °0 ^^ "1 
 "looTrrrodcvf 
 
 VO VO r>N t^ 00 
 ooooo 
 
 O^ CVJ^ in On^ cm 
 
 vo" '-»" lO oC ■^'" 
 00 0\ On a\ o 
 OOOO'-" 
 
 
 rO vO_^ 0\ CM lO <^^ ^. "^ *^ 
 Tf OO" Cvf t^" '-H irT o" "^"^ OO" 
 
 O"«*'00cor^ '-hvootj-on 
 
 CM CM PO fO <0 
 
 ooooo 
 
 On^ CM in 00 i-H 
 cm" InT '-T lO o 
 
 8 8 o o 
 
 Tf tN^ O CO vo 
 ..,,.._ Tt 00 CO tC T-T 
 
 Tl-t^,-iTt-00 '-irfOO'-ivn 
 cOt^CMVOO ioOncOOOCM 
 
 vo vo t^ t>» 00 
 
 OOOOO 
 
 Tl- -* vo lO 
 
 oooo 
 
 s 
 
 Ov^ CM to C» »-H 
 lO O Tf' OO" CO 
 00 CM U-) 00 CM 
 
 \0 '-t to o\ -^ 
 
 O 0\ o 
 
 o o ^ 
 
 Tj- 0\ CO OC) 
 
 oC oo" oo" tvT 
 
 CM LO 00 "-I 
 
 Tf 00 CM l^ 
 
 CO vo O CO 
 
 Tf 00 CO t^ 
 
 O O — ' — ' 
 
 CM vo^ O^ '"^^ Ol 
 
 tC VCD vo irT Tf 
 
 "^ t^ O CO vo 
 
 1-1 UT) O "^ 00 
 
 t^ O "^ t^ O 
 
 1-H vo O '^ 0\ 
 
 CM CM CO CO CO 
 
 ■^ b>. ,-* iq 00^ CM^ vo^ O^ Tj^ t^_ 
 
 -4 CO CO CM i-H 
 
 C7\ CM to 00 — I 
 
 CM t^ T-i to O 
 
 "^ t^ ^ "^ 00 
 
 CO t^ (N vo O 
 
 Tj- Tt- to to vo 
 
 OOOO OOOOO ooooo 
 
 '-' O O 0\ 00 
 
 rj- t^ O CM to 
 
 rt- 00 CO t^ .-" 
 
 i-H "3" 00 i-i to 
 
 to Ov CO 00 CM 
 
 VO vo r>. t^ 00 
 ooooo 
 
 '-' "1. °Q, ^. "\ 
 
 oo" *^" ^ ^' ^ 
 
 00 — I "^ t^ o 
 
 to O -^ 00 CO 
 
 00 CM to 00 CM 
 
 vo r-* to 0\ ^ 
 
 00 Ov 0\ On O 
 
 O O O O -H 
 
 t/3 
 
 o 
 
 H 
 U 
 
 < 
 
 O 
 
 w 
 
 
 8 
 
 ^^ °0 P. °Q- 
 
 co" cm" On" i-h" 
 
 CM O CO CO 
 
 On 00 VO Tf 
 
 CM to 00 i-t 
 
 Tf 00 CM t^ 
 
 CO VO O CO 
 
 rf 00 CO t^ 
 
 gSSo 
 
 CM CM 00 On vo 
 i-h" rC On" oo" ^f 
 00 CO Tj- VO Tj- 
 
 —I 00 to i-H t^ 
 
 "^ vo Ov CM rf 
 »-< to On '<1- 00 
 t^ O CO l^ O 
 
 T-^ vo O rf Oi 
 (VI CM CO CO CO 
 OOOOO 
 
 Ch l>.^ CM^ CM^ 00^ 
 VO to i-h" CO T-*" 
 t^ VO i-t '-• l^ 
 CM t^ CM vo ON 
 
 tx 0\ (VJ "^ VO 
 CM VO i-" to ON 
 
 "«^ t>x T-i Tj- r^ 
 
 CO t^ CM vo O 
 
 Tt Tf to to vo 
 
 ooooo 
 
 o^ t^^ "-1, O^ to_^ 
 tC oo" tC cm" co" 
 00 to 00 tN. i-H 
 
 CM to t^ ON 1—1 
 
 0\ 1— • CO to 00 
 CO 00 CM vo o 
 i-f "^ 00 —' to 
 
 to 0\ CO 00 CM 
 
 VO vo t^ t^ 00 
 OOOOO 
 
 vo CO vo to O 
 
 .-T vo" t^r to" o" 
 
 r-i vo t^ rf t^ 
 
 CM CM CM eg T-H 
 
 O CM Tf VO 00 
 
 to C?N CO t^ i— • 
 
 00 '-' to 00 CM 
 
 vo _i to Q^ rf 
 
 00 On On o\ O 
 
 O O O O '-I 
 
 Mo 
 
 CO CM Tf O 
 
 On" i-h" o" 0\ 
 1^ eo CM O 
 Tf to O 00 
 
 t^ "H CO CM 
 
 O t^ CM CO '-' 
 
 • O t^ On t^ 
 
 Tf t^ Q CO 
 
 CO VO O CO 
 Tj- 00 CO t^ 
 
 O Q i-H '-< 
 OOOO 
 
 iOC3\VOtOON VOOOOCOCO 
 
 VO On CO On VO 
 
 to »— I lO O CO 
 
 t^ t^ to »- > CM 
 
 '-' O O CM VO 
 
 VO 00 t^ CO VO 
 
 O On Tt- to »-< 
 
 vo r^ On o ^ 
 
 vo C7\ CM vo On 
 
 »-( lo O Tf 00 
 
 CM CM CO CO CO 
 
 OOOOO 
 
 CM >— I CO O t^ 
 00 CTn O VO ON 
 t>. to to CO o\ 
 
 CO to CM to T^ 
 
 t^ lO '-H -"^ to 
 CO '-' to Tf ON 
 
 T-H ^ O ON t^ 
 
 CM to 00 O CO 
 
 CO t^ ^-i vo O 
 
 rf- Tj- to to vo 
 
 ooooo 
 
 CM^ ON b>j^ r^ rh 
 0\ rC cm" o" vo" 
 tt n- CM o o 
 
 CM C3n On O O 
 
 CM t^ CM 00 Tj- 
 Tf O to t^ 00 
 O t^ ON t^ .-H 
 
 VO CO O t^ -^ 
 
 VO On CM rf I^ 
 
 ^r 00 CO r^ ^ 
 
 vo vo t^ t^ 00 
 
 ooooo 
 
 On^ On t>.^ CM 00 
 
 ^ vo" CO cm" oC 
 
 vo CO On ^ CO 
 
 t^ O t^ t^ VO 
 
 'T' CM to fo vo 
 
 t^ Tf On CO to 
 
 '-' t>N 00 vo o\ 
 
 O lO O to ON 
 
 o CM to r^ o\ 
 
 ^ O "* 00 CM 
 
 00 o\ o 0\ o 
 
 o o O O --I 
 
 00 
 
 CO 
 coo 
 
 CM_^ vo_^ 00 CM t>.^ On^ co_^ co^ 00^ O, ON CM^ vo^ ^ 
 
 • ' * * ' ' ' • ' ■ oo" tC vo" oo" to" to" oo" co" cm" ■^' co" CM* iC '-' 
 
 * . . * ■ tOrtOt^ tOtOl^Oto VOcoCM.-<r^ 
 
 • • \ , , , I • ; ''-"OcovO OvocOt-hOn vot^coo^ 
 
 • • • ; ; ; ; • • 'tovocMto ovcMi-Htoo \o ^ ^ ^ Zi. 
 
 ' ! ! ; . . . . lOOr^toco tooOCMOO OnonKJco;?! 
 
 ; ; ; , . ; ; , , ;vocmcoo cmononiovo oncmvooo?^ 
 
 • * • ! I ! ■ • ' 'CMt-icooO i-iOnOOCMcO OonCMI^.'-^ 
 
 • ! ; . . . , ' . lONOO-^CM Ov'-HTft^to CM»-<(MCMrt 
 
 • ; ] • \ ; ; \ • icor-iovi-" O'-'^t-cMt^ ocm"^!^^ 
 
 • I I I '. '. '. I '. *. '-•<?\covo vo-^OtooO tii^CMCMr-iO 
 . . , . . . . . I'^t^'-'r^ t^Ocotor^ OCM'^VOOO 
 
 : : : . . . ; : . .oo'-''-' '-•cmcmcmcm cocococo^o 
 
 .-hCMCO"^ tovOt^OOON O'-iCMcO'* tovor^OOC^N p.-iCMco;J 
 
 oooo ooooo ,-1 ■^ r-i T-t wt ,-i,_tr-i^,-i cmcmcmcmc^ 
 
TABLES 
 
 311 
 
 KJ^^8Sa 
 
 to CO CO CO CO 
 
 10 NO t^ CO Ok 
 CO CO CO CO CO 
 
 §5^94 
 
 m NO tN. 00 ON 
 
 TJ- Tf Tf Tt Tj- 
 
 VO 0\ CO vo On 
 00" cvf tC ^ 10" 
 
 ^ ^ CM CM 
 
 CO NO CO t^ 
 
 0" Tt" On" co" tC 
 CO CO CO Tj- -^ 
 
 o_ CO r>v Tf 
 
 cm" no" 0" 10" On" 
 
 in m NO NO NO 
 
 tN.^ ^^ "^^ I^^ "-l, 
 
 t^ l\ 00 TO ON 
 
 Tl- 00 i-H 10 00 
 
 m" on" rf 00" cm" 
 
 Tf l^ CM^ 10 
 
 10 ON (N) S ON 
 
 00 CM t^ ,-H 10 
 
 00 »-< Tt t^ 
 
 00" co" rvT ^ no" 
 
 CM NO On CO NO 
 rf 00 CO t^ 
 
 CO NO ON CM 10 
 
 0" Tj-" 00" co" rC 
 
 CM NO in On 
 
 00 i-H Tj- ts. 
 CO 00 CM NO '-H 
 
 543,3 
 977,5 
 411,8 
 846,1 
 280,4 
 
 ^ ^ CM CM 
 
 CO CO CO Tf -^ 
 
 10 10 NO NO NO 
 
 tv. t^ 00 00 C?N 
 
 »-H T-H r-H ,_( l-H 
 
 SiSia^c^ 
 
 00 CM iO 00 CM 
 Tt Tt ro" <Nf cm" 
 CO VO On CM 10 
 tv. '-' 10 Tf 
 
 m 00 ^ ''d- t^ 
 
 00 CO t^ i-H 10 
 
 co^ NO^ <> CM^ 
 
 00" tC no" lo" m 
 CM in 00 '-H Tf 
 
 '«*• 00 CO t^ 
 
 in rs.^ CO in 
 ■^'" co" co" cm" ^" 
 
 t^ CO NO On 
 "-H NO rl- 00 
 
 00 0^ CO in IN.^ 
 
 CM m t^ CO 
 
 CO t^ T-r NO 
 
 10 On CM NO 0\ 
 00 CM t^ ,-H 10 
 ^ ^ CM CM 
 
 CM NO CTn CO NO 
 Tj- 00 CO l>^ 
 CO CO CO •^ '^ 
 
 CO NO CO 
 
 CM NO in On 
 
 LO in NO NO NO 
 
 t^ Tf r^ 
 
 CO 00 CM NO '-' 
 t^ t^ 00 00 C3N 
 
 »— 1 ,— 1 »-H ,_( »-H 
 
 on ON »-i 
 •-H .-1 CM CM CM 
 
 0_ tN.^ On^ 00^ CM^ 
 
 u^ 00 00 CO ^ 
 00 NO Tl- ^ 
 
 CM On •—< On CO 
 in u-T co" no" tC 
 CM CO CM 
 00 -<* 10 
 
 CO CM '^ 
 Tf" 00" 00" in" 00" 
 t^ t^ CO in CM 
 Tj- 00 CM in 00 
 
 m ^ CO CM t^ 
 
 CM CO rt "^ 
 
 tV.^ Tf ts.^ NO ^^ 
 
 ^s^ i<" co" NO no" 
 m CM in CO t^ 
 m in Tt CO ^ 
 
 '-< CO 10 1^ 
 NO Tf 00 CM 
 10 ON CM 10 ON 
 
 00 CM CO 10 
 NO '-' 10 On CO 
 CM NO ON CM NO 
 
 NO t^ On '-' 
 r^ .-H in "* 
 On CO NO CO 
 
 CO Tt in NO t^ 
 
 00 CM NO "^ 
 
 NO CO t^ 
 
 CO 1^ "^ t^ 
 
 00 CM t>> >-< 10 
 
 ^ ^ CM CM 
 
 Tt 00 CO r^ 
 
 CO CO CO -^ Tj- 
 
 T-t NO in On 
 
 10 m NO NO NO 
 
 CO 00 CM NO '-' 
 t^ t^ 00 00 Ch 
 
 •-H ,-. CM CM CM 
 
 TO 00^ co_ CO "-^ 
 '-<" 10 t^" On" cm" 
 On t^ On 10 NO 
 CO t^ ir> NO t^ 
 
 CM^ 10 CM^ NO^ On^ 
 
 in co" i-T oC rC 
 00 On '-• »o 
 t^ CM CM in r^ 
 
 On CM Tt CM 
 t^ rj- CO in in 
 
 00_^ in in in CM^ 
 00" 0" CO no" no" 
 
 i-H CO 00 t«v NO 
 
 ivT .-T 00" ivT co" 
 
 ■^ CO t^ Tt ON 
 
 Tj- in NO NO 1-H 
 
 m CO Tt -"d- 
 
 NO NO -^ i-H t^ 
 
 00 CO "^ .-< CO 
 
 Tj- lO t^ r-l 00 
 
 C7\ m NO CO t^ 
 Tj- in in 10 Tf 
 CO t^ t^ CO m 
 
 CO t^ t^ CO '!i- 
 
 Q rj- ,-c CM 00 
 
 CO r^ CO Lo 
 CM Tf t>. On »-• 
 t^ T-. 10 ON Tf 
 
 t^ 00 ON 
 CO 10 l^ CM 
 00 CM NO »-• ir> 
 
 C3N 00 t^ m 
 rf in t^ On '-' 
 
 ON CO t>. 1-H NO 
 
 CO t^ Tf 
 
 CO in NO 00 
 rj- 00 CM t^ 
 
 NO 1-H NO i-H in 
 
 I-" CO -^ NO t>. 
 
 »-< in ON CO t^ 
 
 ^ ^ ^ CM 
 
 CM CO CO T}- Tl- 
 
 Tt m in NO NO 
 
 i;^ r^ t^ 00 00 
 
 S^^?)^^ 
 
 0^ 00^ 0^ CM 
 cm" 0" On" cm" On" 
 
 r^ t< to Tt ON 
 
 NO Ch '-' CO 00 
 
 tv.^ ^ 0\ Ol co_^ 
 C?\" Tj-" On" tvT cm" 
 »-i CO T-i r^ Tf 
 
 t^ 00 CO 00 
 
 CO co_ 0^ 00_^ in 
 
 0" l^" tC no" no 
 
 in NO NO '-H CM 
 CO t^ NO 
 
 t^ 0\ CM 
 
 CO t^ CO m -^ 
 
 co_^ vo^ tN.^ vo^ in 
 
 in T-T in" in" 00 
 t^ 00 CO l^ CM 
 
 i^ NO ON CO 
 
 00 r>x Ti- T-. t^ 
 CO i^ On 
 
 Tf CO 00 On r^ 
 vo On t^ CO '— ' 
 CM NO On On On 
 
 Tj- Tt NO t^ 
 
 Tl- (M On 
 m t^ m NO 
 
 :-» NO in NO 
 On in On in ^N, 
 ON 00 CM Tf NO 
 
 CO .-H t^ t^ 
 
 in S 00 CM 
 
 CO CO 00 tN. 
 Tl- t^ NO IT) On 
 C?N 0\ CO i-H CO 
 
 ^ T^ On CO CO 
 CM NO Tf .-• t^ 
 t-i to «-• 10 •^ 
 
 00 CM ^ CO Tj- 
 NO 00 NO 
 CO CM t^ 
 
 On CO CTn 00 CM 
 m 00 -^ NO m 
 t>. CM rr -^ 
 
 CM tN. t^ ^ NO 
 I-" in On -^ On 
 CM t^ CM »-^ 
 
 t^ -^ ^ t^ CM 
 
 ON -H CO ■^ NO 
 CO Tt ■«;*• "^ Tf 
 
 IN. T^ ir> 00 -H 
 
 Tf Tt vo ^ S^ 
 
 xn ^n \n \n *j-> 
 
 CM CM CO CO CO 
 
 S S NO S NO 
 
 CO CM CM i-H Q 
 VO NO NO NO NO 
 
 CM CM CM CM CM 
 
 »-i CM CO Th 
 CO CO CO CO cO 
 
 to NO t^ 00 On 
 CO CO CO CO CO 
 
 -H CM CO ^ 
 ""^ -^ "* Tj- Tl- 
 
 in NO t^ 00 On 
 '^ "^ -t Tl- 1^ 
 
312 
 
 LOGARITHMS 
 
 
 Pi 
 O 
 H 
 
 u 
 o 
 
 < 
 
 6 
 
 o i-H rq «r> Tt 
 
 lO VO tN. 00 
 
 0\ 
 
 o 
 
 ^ 
 
 CM CO T^ 
 
 in NO 
 
 VO NO 
 
 t^ 00 ON 
 
 O 1-1 CM CO ■^ 
 
 1^ 
 
 to lO U-) lO lO 
 
 to to to to 
 
 to 
 
 NO 
 
 NO 
 
 NO NO NO 
 
 NO NO NO 
 
 t^ t^ t^ ^>. t>. 
 
 * 
 
 »-• »o 00 C^ lO 
 
 C7\ CM lO On 
 
 CM 
 
 vq^ 
 
 C3N 
 
 CO vo O 
 
 co^ vq 
 
 O^ co^ l^^ 
 
 O^ CO^ tN.^ O '^ 
 
 
 
 
 
 
 
 
 
 
 feS 
 
 0, t>. ^ lO O -^ 
 
 oo" co" tC ^ 
 
 no" 
 
 o 
 
 '«t" 
 
 On" co" tC 
 
 cm'~ no" 
 
 '— r to oC 
 
 Tf" oo" cm" tvT ^" 
 
 O O t-H ^ CM 
 
 O '-' CVJ CM ro CO 
 
 CO Tj- -^ to 
 
 to 
 
 NO 
 
 ^ 
 
 NO t^ t^ 
 
 00 00 
 
 On C3N On 
 
 1— i 
 
 • CVJ CVJ CM CM CN 
 
 CM CM CM CM 
 
 CM 
 
 <N 
 
 CM 
 
 CM CM CM 
 
 CM CM 
 
 CM CM CM 
 
 CO CO CO CO CO 
 
 
 tsj^ o^ CO vq^ o\ 
 
 CM to 00 T-i 
 
 "it 
 
 In. 
 
 O 
 
 CO NO 00 
 
 '"1. '^^ 
 
 ^ O^ co_^ 
 
 NO On^ CM^ to 00 
 
 $ 
 
 Wb 
 
 
 
 
 
 
 •> - .^ 
 
 
 
 
 rt oT CO tC i-H 
 
 no" o" •^'' oC 
 
 CO 
 
 rC 
 
 cm" 
 
 ^83; 
 
 0\ co" 
 
 In." cm" no" 
 
 o T}- oT CO r>r 
 
 ^ Tj- 00 '-' lO 
 
 00 CM u^ 00 
 
 CM 
 
 to 
 
 ON 
 
 CM NO 
 
 ON CO NO 
 
 O CO NO O CO 
 
 ^ t^ ^ lO O Tl- 
 
 • '-H CM CM CO CO 
 
 00 CO t^ ^ 
 
 NO 
 
 o 
 
 Tj- 
 
 ON CO t^ 
 
 CM NO 
 
 O to On 
 
 rf CO CM tN ^ 
 
 »-i 
 
 CM CM CM CM 
 
 to 
 
 NO 
 
 NO 
 
 NO t>H t^ 
 
 00 00 
 
 C?N On On 
 
 O O '-I ,-( CM 
 
 
 CM CM CM <N1 CM 
 
 CM 
 
 CM 
 
 <N 
 
 CM CM CM 
 
 CM CM 
 
 CM CM CM 
 
 CO CO CO CO CO 
 
 $ 
 
 O^ CM^ ''t t>j, 0\ 
 
 »-i CO *o t^ 
 
 ON 
 
 
 CO 
 
 Tt_^ NO^ 00 
 
 o ^ 
 
 CO Tf O^ 
 
 '^ c> o, *-<_ CO 
 
 
 
 
 
 
 
 
 
 
 rC VO to rj-" po" 
 
 Co" CM ^ O" 
 
 On" 
 
 0\ 
 
 § 
 
 tC no" to" 
 
 to" rf 
 
 co" cm" '-*" 
 
 <z> on" OS oo" rC 
 
 
 vo CA rg to 00 
 
 '-I Tj- tv. O 
 
 CM 
 
 to 
 
 ^ Tf r^ 
 
 O CO 
 
 NO ON CM 
 
 to t^ CD CO NO 
 
 § 
 
 Tj- 00 CO r^ ^ 
 
 NO O '<4- ON 
 
 CO 
 
 t^ 
 
 
 NO O ^ 
 
 C7N CO 
 
 tN ^ NO 
 
 O "^ On CO t^ 
 
 
 O '-' "^ 00 -H to 
 
 00 rg lo 00 
 
 CM 
 
 to 
 
 On 
 
 CM no On 
 
 CM NO 
 
 CA CO NO 
 
 O CO NO O CO 
 
 H t^ ^ to O T»- 
 
 00 CO t^ — 
 
 NO 
 
 o 
 
 Tj- 
 
 ON ro r^ 
 
 (M NO 
 
 O to ON 
 
 ■^ 00 CM l^ ^ 
 
 -H CM CM CO CO 
 
 CO T}- Tf to 
 
 to 
 
 NO 
 
 O 
 
 NO t^ r^ 
 
 00 00 
 
 ON ON ON 
 
 O O T-H ^ CM 
 
 CM CM CM CM CN 
 
 CM CM CM CM 
 
 CM 
 
 CM 
 
 CM 
 
 CM CM CM 
 
 CM CM 
 
 CM CM CM 
 
 CO CO CO CO CO 
 
 
 CM O CO CO 0\ 
 
 '-< On CO Tf 
 
 
 rl- 
 
 CO 
 
 CTn 0_ 00^ 
 
 CO CO 
 
 O CO CM 
 
 00 O 00 CO Tj- 
 
 
 ^ ^ ^ ^ - 
 
 
 
 
 
 
 
 
 
 
 CM lO Tt- o CM 
 
 cm'' rC o" oC 
 
 to 
 
 tC 
 
 no" 
 
 '-H Tf" cm" 
 
 oo" o" 
 
 on" t^ no" 
 NO 00 to 
 
 rf o" ^" O" lo" 
 
 ^ 
 
 t^ CM CO O CM 
 
 O CO CO t^ 
 
 00 
 
 Tj- 
 
 "^ 
 
 -^ l^ NO 
 
 O '-' 
 
 00 t^ ^ ,-1 NO 
 
 * 
 
 0\ t^ -"I- I-" t^ 
 
 CO 00 CO r^ 
 
 
 tO 
 
 00 
 
 ^ CO »o 
 
 t^ 00 
 
 00 00 00 
 
 tN NO lO CO O 
 
 ug 
 
 o ^ ^ "* '^ "^ 
 
 o c^ CO t^ 1-1 to 
 
 NO ^O t^ t^ 
 
 00 
 
 ^ 
 
 00 
 
 On On On 
 
 On C?n 
 
 0\ On On 
 
 On On On On On 
 On CO r^ T-H to 
 
 ON CO t^ '-' 
 
 to 
 
 CO 
 
 l^ '-H to 
 
 On CO 
 
 t^ ^ to 
 
 O O Tf t^ ^ Tj- 
 
 t^ -H TT 00 
 
 
 -* 
 
 00 
 
 r-l to 00 
 
 ^ lO 
 
 00 CM to 
 
 00 CM to O* CM 
 
 l^ 1-t to O Tf 
 
 00 CO t^ »-H 
 
 NO 
 
 o 
 
 Tj- 
 
 ON CO r^ 
 
 CM NO 
 
 ^ ^ O^ 
 
 CO 00 CM NO '-t 
 
 
 »-< CM CM CO CO 
 
 CO Tt Tj- to 
 
 to 
 
 NO 
 
 NO 
 
 NO t^ t^ 
 
 00 00 
 
 O O ^ '-• CM 
 
 
 CM CM CM CM CM 
 
 CM CM CM CM 
 
 CM 
 
 CM 
 
 CM 
 
 CM CM CM 
 
 <N ^ 
 
 ^ 04 CM 
 
 CO CO CO CO CO 
 
 
 On CM t^ to to 
 
 t^ 00^ Tf CvJ^ 
 
 "1 
 
 °° 
 
 CO^ 
 
 to CO O 
 
 00 NO 
 
 to to 00 
 
 CM^ Oi 00 O^ "^ 
 
 
 J. i. ^ 
 
 
 
 
 
 i. 
 
 ^ 
 
 
 
 
 O* 00 t^ to vo 
 
 co" InT rC On" 
 
 tC 
 
 Tj-" 
 
 ,— r 
 
 to CO ON 
 
 ^^ 
 
 Tf cm" oo" 
 
 to" «-<" no" no" co" 
 
 
 VO CM r-H 00 t^ 
 
 CO ON O ON 
 
 o 
 
 NO 
 
 o 
 
 Tj- CM to 
 
 CM On O 
 
 00 CO to NO NO 
 
 
 O O 00 '-I 00 
 
 VO ^ CO NO 
 
 
 CM 
 
 ON 
 
 r>^ to C3N 
 
 t^ NO 
 
 '^ NO CM 
 
 NO 00 CO Oi CO 
 
 ■N' 
 
 0\ vO C?N ^ O 
 
 On 00 t^ t^ 
 
 Q 
 
 to 
 
 CO 
 
 NO Tj- t^ 
 
 -^ NO <N 
 
 t^ "^ 
 
 On CM to 
 
 t>s O to ^ --I 
 
 *^« * 
 
 0\ «-! CO t^ '-I 
 
 to i:-5 00 NO 
 
 NO 
 
 NO 
 
 00 
 
 o o 
 
 r-l to O 
 
 t^ t^ 00 CM 00 
 
 Wo 
 
 O CM t^ t>. CO vo 
 
 rf On ON NO 
 
 CTn 
 
 00 
 
 CO 
 
 to CM NO 
 
 NO CM 
 
 Tj- CM t^ 
 
 t^ Tf t^ tN C^ 
 
 *-< 
 
 0\ (M to 00 O 
 
 CM CO Tl- to 
 
 to 
 
 to 
 
 to 
 
 Tj- CO ^ 
 
 CTn t^ 
 
 Tj- r-H t^ 
 
 CO O rf CA Tj- 
 
 
 00 O '-H CM -^ 
 
 ^ VO O '^t 00 
 
 to NO r^ oo 
 
 ON 
 
 o 
 
 
 CM CO Tj- 
 
 Tf to 
 
 NO t^ t^ 
 
 00 00 On CTn O 
 
 
 <N NO O '«:^ 
 
 00 
 
 CO 
 
 t^ 
 
 ^ to ON 
 
 CO t^ 
 
 ^ to C7N 
 
 CO r^ '-H to o 
 
 
 i-H 1^ CM CM CM 
 
 CO CO -^ •* 
 
 ""^ 
 
 to 
 
 to 
 
 NO NO NO 
 
 1^ t^ 
 
 00 00 00 
 
 0\ o\ o o zt 
 
 
 CM CM CM CM CM 
 
 CM CM CM CM 
 
 CM 
 
 CM 
 
 CM 
 
 CM CM CM 
 
 CM CM 
 
 CM CM CM 
 
 CM CM CO CO CO 
 
 
 O, Ol 00^ 00^ o^ 
 
 CM CM lO C^ 
 
 
 vO_ 
 
 00 
 
 CO VO^ON^ 
 
 On On 
 
 00 CH '^^ 
 
 CO '-I CO to O 
 
 
 
 
 
 
 
 
 
 
 
 
 vcT t~>r '^^ <3^ crT 
 
 rt no" cm" cm* 
 
 CM 
 
 Co" 
 
 o" 
 
 OO" co" co" 
 
 CM <-< 
 
 O no" l^" 
 
 rf On" -^ O '-I 
 
 
 CO On CO O Cvl 
 
 ON O t^ NO 
 
 NO 
 
 00 
 
 
 ON VO 00 
 
 Tf Tf 
 
 O O CO 
 
 ,-. ^ CO CM CO 
 
 
 CO O VO VO 00 
 
 Tf O VO to 
 
 CO 
 
 o 
 
 rf Tf ON 
 
 NO "^ 
 
 t^ tN r^ 
 
 O tN ■* "-I tN 
 
 , » 
 
 Tj- vo CO en On 
 
 O t^ lO CO 
 
 ^ 
 
 O 
 
 to 
 
 On ON CO 
 
 NO 'J^ 
 
 CM CM O 
 
 o 00 ^ o c^ 
 
 Q t^ "^ MD lO 
 
 S T-H CO 00 t^ 
 
 OO CM ^O On 
 
 
 to 
 
 CO 
 
 ^;%s^ 
 
 to CO 
 
 M O^ o 
 
 rj- Tj- ON NO '-' 
 
 ^ ; 
 
 NO O 00 CTn 
 
 o 
 
 .^ 
 
 00 
 
 CO On 
 
 O CO ^ 00 tN 
 
 » 
 
 O O CO to CO 
 
 CM 00 Tf t^ 
 
 CM 
 
 ,_, 
 
 ON 
 
 ^ O 0\ 
 
 CO CO 
 
 Tf 00 ON 
 
 00 00 CM CM "-I 
 
 
 t^ t^ O t^ On 
 
 NO 00 l\ CM 
 
 to 
 
 to 
 
 <^ 
 
 On "^ t^ 
 
 T-> -rf 
 
 r^ o Tf 
 
 <^ ^ S2 £^ j:^ 
 
 
 0\ u-> O CM CO 
 
 CO ^ 00 Tf 
 
 00 
 
 
 <o 
 
 CO CO »-l 
 
 ON ^n 
 
 O lO 00 
 
 O CM CO CO CM 
 
 
 00 t^ U3 Tl- CM 
 
 O 00 lO CO 
 
 o 
 
 00 
 
 to 
 
 CM cn NO 
 
 CM ON 
 
 NO CM 00 
 
 "^ '-' ^ 5^A 
 
 
 ON O '-' CM CO 
 
 rf T^ to vo 
 
 t^ 
 
 t^ 
 
 00 
 
 C3N On O 
 
 
 CM CO CO 
 
 ^ K? ^ )^^B 
 
 
 NO t^ t^ t^ t^ 
 
 t^ t^ t^ t^ 
 
 t^ 
 
 t^ 
 
 t^ 
 
 t^ t^ 00 
 
 00 S 
 
 00 00 00 
 
 00 00 00 ^H| 
 
 d 
 
 O r^ CM CO rh 
 
 to NO tN, 00 
 
 C3N 
 
 s 
 
 
 CM CO rh 
 
 to NO 
 
 t^ 00 On 
 
 rkkksI 
 
 to to lO to lO 
 
 to to lO to 
 
 to 
 
 NO 
 
 NO NO NO 
 
 NO NO 
 
 VO NO NO 
 
 
 
 
 
 
 
 
 
 
 
 — 1 
 
TABLES 
 
 313 
 
 *5VOt^00O\ O'-'OJcOrJ- tovor^COOx Q'-'C^fOrJ- lovOt^00O\ 
 
 i^i>.t^t^t^ 00000000 00 0000000000 a\ONONO\o\ o\o\o\o\o\ 
 
 t>. »-H Tf b>.^ »-«^ '^^ 00^ '"1, "1 °0 ^^ "1 00 ^^ "1 CA ^. ^ ^ ^^ ^ ^ *^ ^^ Q 
 
 ioO"^odco rCi-Tvoo-^" oCcorvTcvfvo" oiooCcood cvfvo'-^^too 
 
 fsJcof^coTf rfioiovovo vot^t^OOOO OnOnOnOO ^»-HC^cv>ro 
 
 fO«^<^<^fO COCOCOfOCO COCOCOCOCO COCOfOTj-Tj- rJ-Tj-Tj-Tj-Tj- 
 
 »-H Tt r>.^ o CO ^ o\^ *-! "^ ^\ o CO vo ch CN "^ 00 '-H^ Tt tN^^ o fo vq 0\^ c^^ 
 
 cvf vo o" in oT CO tC rg" vo" o" 10 oT crT rC csT ^ o' m" oC crT 00 cm" vo o" 10 
 
 t^QTft^o '^t^'-H'-^oo '-iTj-oO'-Hii-> ^cgiooorq u-)0\cgvoON 
 
 mO-^OOco t>.'-tvOOrf 0\cotN.cgvo Oioa\c<oOO CNJVO'-'IOOn 
 
 CvjcocooOTj- TfiOiOVOvO vot^t^OOOO CJnonOvOQ »-iT-iCVirQC^ 
 
 cococococo cococococo cococococo cOcocorj--^ rJ-rf'^Tf'^ 
 
 "^ to vq^ tN^ CA p^ i-H <M CM co^ Tt 10 vq^ vq^ tv.^ t^_ 00^ o\ 0\ c^ cq o^ cd '-<^ 't 
 
 vd in rt CO cvT cm" t-T o" oC oo" ivT vo" 10 rf^ ro' cm" i-T o" oC 00" cjo" tC \o tn Tf 
 
 ChCMiOOO'-H Tj-t^OCMiO 00'-i"^t^O CO»oO\T-iT|- tN.OC0VP0\ 
 
 ^\OOTfO\ COt^CMM^O Tj-ONCOt^CM ^O^^Onco l^CMVOO"^ 
 
 t^OTft^O Ttt^T-HTfOO ^TtOO'-'iO OOCMIOOOCM iOO\CMVOON 
 
 JOO'^OOco t^t-"VOOTf ONCOt^CMVO OinONCOOO CMVO'-'inON 
 
 CMcocorOTt- "rf \n m \0 \0 vOt^t^OOOO OnonOsOO »-<t-HCMCMCM 
 
 fOrocococo cocococoeo c*ococococo cocororf'^ rfrfTt^Tj- 
 
 ^_^ Lo 10^ CM_^ Tj-_^ "^ ^^ '"L ^ "1 ^> "^^ °°^ °°„ ^^ <^ ^^ ^ ^ °0 "^ *^> ^. ^> ^ 
 
 tC 10 o" eg o" in vo" ltT o' »-'" ctT Tt-" irT co" 00" 0\ tC cm" CO '-T vo" tvT m" O '-h" 
 
 t^Tft^iOOs OOCO"^,— ifo OTj-coOOOO TfVO'^tN.VO QOVOOOm 
 
 tx'<^OVO'-" vO'-hioonCM inr^ONO'-' CMCMCM'-'O O\t^'^»-H00 
 
 000000t>*t^ vOVOiOrtrh coCM'-'^-'O CTvOOtvVOiO r«^CM*-HQOO 
 
 ONCOt^'-'m C7\cot^T-Hio O\rot^'-"io OOCMVOOrt OOCMVOOCO 
 
 voO\CMvOC?\ CMVOOncovO OncovOOco V00cot>.0 cot^O^tN, 
 
 tOO\«^00(M t^i-imO"^ OOcor^CMVO OiO0\C000 CMVO»-HlOO\ 
 
 CMCMcorOTt Tj-ioiOVOO VOt^t^OOOO 0\C7\0\00 '-'^-^CMCMCVl 
 
 COCOCOCOCO COCOCOCOCO COCOCOCOCO COCOCO'^TJ- TfrfTj-^^ 
 
 vq Tf o^ t^^ Oi o\ CO vq^ co^ -^^^ 10^ oo_^ co_ cm_^ 00^ vq^ ^ *^^ *^ "^ *"! "^ *^^ *"!. "^ 
 
 '-H o" 00" o" cm" vo" CO o" 10" cm" tj-" cm" «o" cm" 10 o" 00" 00' OS t^ vo 00" •^ Tt co" 
 
 lOCOOVLOOO OOiOt^CMO OOmOOVOm tJ-OOVOtI-ON l>*Tj-tX»-<CM 
 
 CMCOCMOOVO -^ONt^VOCM '-"CMOCOt^ 0\mc00sC7\ r-iT-Hio»-H^ 
 
 Tt^coOTj- mcoOvoCM OOiOTj-ioch t^OOO^Ti ONTht>^OfM 
 
 VOt^OVOTf ioOnVOioOO coCMTfONt^ OniocovoCM »-<mCMTfO\ 
 
 TtCMt^t^-"* t>.voCMTl-CM r^OOiOOOOO rft^VOr-ifO riioVOrOVO 
 
 OOCMiOOO^ COiOt^OOON <:^O^O^00^^ vOTfCMOt^ ^OVOCMtX 
 
 O^^^CV, CMCMCMCMCM CMCMCMCMCM CMCMCMCM'-' r-i^OOQ. 
 
 "^OOCMVOO -"ii-OOCMvoo -"^OOCMVOO rf-QOCMVOO rtOOCMVoSv 
 
 ^-H^CMCMco rocOTfrtin miovovor^ I^t^OOOOON 0\0\000 
 
 COCOCOCOCO rOCOCOCOCO COCOCOCOCO COCOCOtOCO COCO"^^Tf 
 
 t>._ oo_^ 10 "T, ■^^ o\^ vq tN.^ '-H o\^ CO vo^ vq CM^ o^ co^ '-j, vq ov i^ 00 vo cm 10 10 
 
 T-T o" cm" o o" i-h" 00" CO vo" r-T Tj^ ro" 00" o" T}-" oT ^" Lo" co" oC ocJ" os vo" cm" tC 
 
 ONOOt^ONON Ovt^OOt^vO r-HTj-^LOrt coCM-^mOV (iOcOVOONOV 
 
 coCM'-hvocm 0\OOCOcoO ^s.CMVO'-lVO Tj-cocoioiO CMOCMVOm 
 
 COCM10CM3-H VOOOCMCMVO iOt-hCMCMVO OvCMt^OOfO lOCOThiOrf 
 
 VOC3VCMOO\ OO'-HiOOvOO (Mmiol^Q OONCMrfiO OcocoIn^Ov 
 
 CMiOI>^vOO C^OOOOCM On-^CMVOO mroOOONCX) VOCMt^O«-H 
 
 '-iCOO^r^ OvincoOOOS OOOOO^CMO CM'-<r^<Mt^ CO'-h.-hVOio 
 
 >S;3;2iSf>J 9S°2;3Ji:5J^: !r2^'-'00<^ ^t-rtoooocM r<it^»N.CMco 
 
 OOO^tOvo O-^OOOCM T^TJ•^or^co CMOt^'^'-H tN.CMt^CMVO 
 
 IPQ^^i^ C000co0\rf Ov'^CAThON rhCAcooOco tvCMVO'-fiO 
 
 f^5959Sj^ S?Q!Z''~'^ cMcocoTf-*^ miovovoi^ t^ooooo\ON 
 
 0000000000 0^0\o^o^o^ onO\c?no\o\ o\ a\ o\ os a\ 0\ o\ c\ 0\ 0\ 
 
 lOVOr^OOON Ot-iCMcotT mvot^OOCTv Or-iCMro'^ lOVOt^COOv 
 
 t>^t^t^t>.t^ 0000000000 0000000000 o\ o\ o\ o\ o\ 0\ 0\ 0\ 0\ 0\ 
 
314 
 §359. 
 
 LOGARITHMS 
 
 Table of Interest Ratios 
 
 1 + i 
 
 Logarithm 
 
 1 + i 
 
 Logarithm 
 
 1.00125 
 
 000 542 529 092 294 
 
 1.01 
 
 004 321 373 782 643 
 
 1.0015 
 
 000 650 953 629 595 
 
 1.01025 
 
 004 428 859 114 686 
 
 1.00175 
 
 000 759 351 104 737 
 
 1.0105 
 
 004 536 317 851 323 
 
 1.002 
 
 000 867 721 531 227 
 
 1.01075 
 
 004 643 750 005 712 
 
 1.00225 
 
 000 976 064 922 559 
 
 1.011 
 
 004 751 155 591 001 
 
 1.0025 
 
 001 084 381 292 220 
 
 1.01125 
 
 004 858 534 620 329 
 
 1.00275 
 
 001 192 670 653 684 
 
 1.0115 
 
 004 965 887 106 823 
 
 1.003 
 
 001 300 933 020 418 
 
 1.01175 
 
 005 073 213 063 604 
 
 1.00325 
 
 001 409 168 405 876 
 
 1.012 
 
 005 180 512 503 780 
 
 1.0035 
 
 001 517 376 823 504 
 
 1.01225 
 
 005 287 785 440 451 
 
 1.00375 
 
 001 625 558 286 737 
 
 1.0125 
 
 005 395 031 886 706 
 
 1.004 
 
 001 733 712 809 001 
 
 1.01275 
 
 005 502 251 855 626 
 
 1.00425 
 
 001 841 840 403 709 
 
 1.013 
 
 005 609 445 360 280 
 
 1.0045 
 
 001 949 941 084 268 
 
 1.01325 
 
 005 716 612 413 731 
 
 1.00475 
 
 002 058 014 864 072 
 
 1.0135 
 
 005 823 753 029 028 
 
 1.005 
 
 002 166 061 756 508 
 
 1.01375 
 
 005 930 867 219 212 
 
 1.00525 
 
 002 274 081 774 949 
 
 1.014 
 
 006 037 954 997 317 
 
 1.0055 
 
 002 382 074 932 761 
 
 1.01425 
 
 006 145 016 376 364 
 
 1.00575 
 
 002 490 041 243 299 
 
 1.0145 
 
 006 252 051 369 365 
 
 1.006 
 
 002 597 980 719 909 
 
 1.01475 
 
 006 359 059 989 323 
 
 1.00625 
 
 002 705 893 375 925 
 
 1.015 
 
 006 466 042 249 232 
 
 1.0065 
 
 002 813 779 224 673 
 
 1.01525 
 
 006 572 998 162 075 
 
 1.00675 
 
 002 921 638 279 469 
 
 1.0155 
 
 006 679 927 740 826 
 
 1.007 
 
 003 029 470 553 618 
 
 1.01575 
 
 006 786 830 998 449 
 
 1.00725 
 
 003 137 276 060 415 
 
 1.016 
 
 006 893 707 947 900 
 
 1.0075 
 
 003 245 054 813 147 
 
 1.01625 
 
 007 000 558 602 125 
 
 1.00775 
 
 003 352 806 825 089 
 
 1.0165 
 
 007 107 382 974 057 
 
 1.008 
 
 003 460 532 109 506 
 
 1.01675 
 
 007 214 181 076 625 
 
 1.00825 
 
 003 568 230 679 656 
 
 1.017 
 
 007 320 952 922 745 
 
 1.0085 
 
 003 675 902 548 784 
 
 1.01725 
 
 007 427 698 525 323 
 
 1.00875 
 
 003 783 547 730 127 
 
 1.0175 
 
 007 534 417 897 258 
 
 1.009 
 
 003 891 166 236 911 
 
 1.01775 
 
 007 641 111 051 437 
 
 1.00925 
 
 003 998 758 082 352 
 
 1.018 
 
 007 747 778 000 740 
 
 1.0095 
 
 004 106 323 279 658 
 
 1.01825 
 
 007 854 418 758 035 
 
 1.00975 
 
 004 213 861 842 026 
 
 1.0185 
 
 007 961 033 336 183 
 
TABLES 
 
 315 
 
 Table of Interest Ratios — {Continued) 
 
 1 + i 
 
 Logarithm 
 
 1 1 + * 
 
 Logarithm 
 
 1.01875 
 
 008 067 621 748 033 
 
 1.0275 
 
 Oil 781 830 548 107 
 
 1.019 
 
 008 174 184 006 426 
 
 1.02775 
 
 Oil 887 485 452 387 
 
 1.01925 
 
 008 280 720 124 194 
 
 1.028 
 
 Oil 993 114 659 257 
 
 1.0195 
 
 008 387 230 114 159 
 
 1.02825 
 
 012 098 718 181 213 
 
 1.01975 
 
 008 493 713 989 132 
 
 1.0285 
 
 012 204 296 030 743 
 
 1.02 
 
 008 600 171 761 918 
 
 1.02875 
 
 012 309 848 220 326 
 
 1.02025 
 
 008 706 603 445 309 
 
 1.029 
 
 012 415 374 762 433 
 
 1.0205 
 
 008 813 009 052 089 
 
 1.02925 
 
 012 520 875 669 524 
 
 1.02075 
 
 008 919 388 595 035 
 
 1.0295 
 
 012 626 350 954 050 
 
 1.021 
 
 009 025 742 086 910 
 
 1.02975 
 
 012 731 800 628 455 
 
 1.02125 
 
 009 132 069 540 472 
 
 1.03 
 
 012 837 224 705 172 
 
 1.0215 
 
 009 238 370 968 466 
 
 1.0305 
 
 013 047 996 115 232 
 
 1.02175 
 
 009 344 646 383 631 
 
 1.031 
 
 013 258 665 283 517 
 
 1.022 
 
 009 450 895 798 694 
 
 1.0315 
 
 013 469 232 309 170 
 
 1.02225 
 
 009 557 119 226 374 
 
 1.032 
 
 013 679 697 291 193 
 
 1.0225 
 
 009 663 316 679 379 
 
 1.0325 
 
 013 890 060 328 439 
 
 1.02275 
 
 009 769 488 170 411 
 
 1.033 
 
 014 100 321 519 621 
 
 1.023 
 
 009 875 633 712 160 
 
 1.0335 
 
 014 310 480 963 307 
 
 1.02325 
 
 009 981 753 317 307 
 
 1.034 
 
 014 520 538 757 924 
 
 1.0235 
 
 010 087 846 998 524 
 
 1.0345 
 
 014 730 495 001 753 
 
 1.02375 
 
 010 193 914 768 475 
 
 1.035 
 
 014 940 349 792 937 
 
 1.024 
 
 010 299 956 639 812 
 
 1.0355 
 
 015 150 103 229 471 
 
 1.02425 
 
 010 405 972 625 180 
 
 1.036 
 
 015 359 755 409 214 
 
 1.0245 
 
 010 511 962 737 214 
 
 1.0375 
 
 015 988 105 384 130 
 
 1.02475 
 
 010 617 926 988 539 
 
 1.038 
 
 016 197 353 512 439 
 
 1.025 
 
 010 723 865 391 773 
 
 1.039 
 
 016 615 547 557 177 
 
 1.02525 
 
 010 829 777 959 522 
 
 1.04 
 
 017 033 339 298 780 
 
 1.0255 
 
 010 935 664 704 385 
 
 1.041 
 
 017 450 729 510 536 
 
 1.02575 
 
 Oil 041 525 638 950 
 
 1.0425 
 
 018 076 063 645 795 
 
 1.026 
 
 Oil 147 360 775 797 
 
 1.043 
 
 018 284 308 426 531 
 
 1.02625 
 
 Oil 253 170 127 497 
 
 1.044 
 
 018 700 498 666 243 
 
 1.0265 
 
 Oil 358 953 706 611 
 
 1.045 
 
 019 116 290 447 073 
 
 1.02675 
 
 Oil 464 711 525 690 
 
 1.046 
 
 019 531 684 531 255 
 
 1.027 
 
 Oil 570 443 597 278 
 
 1.0475 
 
 020 154 031 638 333 
 
 1.02725 
 
 Oil 676 149 933 909 
 
 1.048 
 
 020 361 282 647 708 
 
3i6 LOGARITHMS 
 
 Table of Interest Ratios — (Concluded) 
 
 1 + i 
 
 Logarithm 
 
 1 + i 
 
 Logarithm 
 
 1.049 
 
 1.05 
 
 1.055 
 
 1.06 
 
 1.065 
 
 020 775 488 193 558 
 
 021 189 299 069 938 
 023 252 459 633 711 
 025 305 865 264 770 
 027 349 607 774 757 
 
 1.07 
 
 1.075 
 
 1.08 
 
 1.09 
 
 1.10 
 
 029 383 777 685 210 
 031 408 464 251 624 
 033 423 755 486 950 
 037 426 497 940 624 
 041 392 685 158 225 
 
 §360. 
 
 Table of Sub-Reciprocals 
 
 Initial 
 
 Sub- 
 
 Initial 
 
 Sub- 
 
 Figures 
 
 Reciprocal 
 
 Figures 
 
 Reciprocal 
 
 10 
 
 90 
 
 35-36 
 
 27 
 
 11 
 
 83 
 
 37 
 
 26 
 
 12 
 
 76 
 
 38-39 
 
 25 
 
 13 
 
 71 
 
 40 
 
 24 
 
 14 
 
 66 
 
 41-42 
 
 23 
 
 IS 
 
 62 
 
 43-44 
 
 22 
 
 16 
 
 58 
 
 45-46 
 
 21 
 
 17 
 
 55 
 
 47-49 
 
 20 
 
 18 
 
 52 
 
 50-51 
 
 19 
 
 19 
 
 50 
 
 52-54 
 
 18 
 
 20 
 
 47 
 
 55-57 
 
 17 
 
 21 
 
 45 
 
 58-61 
 
 16 
 
 22 
 
 43 
 
 62-65 
 
 15 
 
 23 
 
 41 
 
 66-70 
 
 14 
 
 24 
 
 40 
 
 71-75 
 
 13 
 
 25 
 
 38 
 
 76-82 
 
 12 
 
 26 
 
 27 
 
 83-89 
 
 11 
 
 27 
 
 35 
 
 90 
 
 10 
 
 28 
 
 34 
 
 
 
 29 
 
 33 
 
 
 
 30 
 
 32 
 
 
 
 31 
 
 31 
 
 
 
 32 
 
 30 
 
 
 
 33 
 
 29 
 
 
 
 34 
 
 28 
 
 
 
FORMING LOGARITHMS 
 
 317 
 
 §361. 
 
 
 
 Table of Multiples 
 
 
 
 1 
 
 2 
 
 3 
 
 4 
 
 5 
 
 6 
 
 7 
 
 8 
 
 9 
 
 001 
 
 002 
 
 003 
 
 004 
 
 005 
 
 006 
 
 007 
 
 008 
 
 009 
 
 002 
 
 004 
 
 006 
 
 008 
 
 010 
 
 012 
 
 014 
 
 016 
 
 018 
 
 003 
 
 006 
 
 009 
 
 012 
 
 015 
 
 018 
 
 021 
 
 024 
 
 027 
 
 004 
 
 008 
 
 012 
 
 016 
 
 020 
 
 024 
 
 028 
 
 032 
 
 036 
 
 005 
 
 010 
 
 015 
 
 020 
 
 025 
 
 030 
 
 035 
 
 040 
 
 045 
 
 006 
 
 012 
 
 018 
 
 024 
 
 030 
 
 036 
 
 042 
 
 048 
 
 054 
 
 007 
 
 014 
 
 021 
 
 028 
 
 035 
 
 042 
 
 049 
 
 056 
 
 063 
 
 008 
 
 016 
 
 024 
 
 032 
 
 040 
 
 048 
 
 056 
 
 064 
 
 072 
 
 009 
 
 018 
 
 027 
 
 036 
 
 045 
 
 054 
 
 063 
 
 072 
 
 081 
 
 010 
 
 020 
 
 030 
 
 040 
 
 050 
 
 060 
 
 070 
 
 080 
 
 090 
 
 Oil 
 
 022 
 
 033 
 
 044 
 
 055 
 
 066 
 
 077 
 
 088 
 
 099 
 
 012 
 
 024 
 
 036 
 
 048 
 
 060 
 
 072 
 
 084 
 
 096 
 
 108 
 
 013 
 
 026 
 
 039 
 
 052 
 
 065 
 
 078 
 
 091 
 
 104 
 
 117 
 
 014 
 
 028 
 
 042 
 
 056 
 
 070 
 
 084 
 
 098 
 
 112 
 
 126 
 
 015 
 
 030 
 
 045 
 
 060 
 
 075 
 
 090 
 
 105 
 
 120 
 
 135 
 
 016 
 
 032 
 
 048 
 
 064 
 
 080 
 
 096 
 
 112 
 
 128 
 
 144 
 
 017 
 
 034 
 
 051 
 
 068 
 
 085 
 
 102 
 
 119 
 
 136 
 
 153 
 
 018 
 
 036 
 
 054 
 
 072 
 
 090 
 
 108 
 
 126 
 
 144 
 
 162 
 
 019 
 
 038 
 
 057 
 
 076 
 
 095 
 
 114 
 
 133 
 
 152 
 
 171 
 
 020 
 
 040 
 
 060 
 
 080 
 
 100 
 
 120 
 
 140 
 
 160 
 
 180 
 
 021 
 
 042 
 
 063 
 
 084 
 
 105 
 
 126 
 
 147 
 
 168 
 
 189 
 
 022 
 
 044 
 
 066 
 
 088 
 
 110 
 
 132 
 
 154 
 
 176 
 
 198 
 
 023 
 
 046 
 
 069 
 
 092 
 
 115 
 
 138 
 
 161 
 
 184 
 
 207 
 
 024 
 
 048 
 
 072 
 
 096 
 
 120 
 
 144 
 
 168 
 
 192 
 
 216 
 
 025 
 
 050 
 
 075 
 
 100 
 
 125 
 
 150 
 
 175 
 
 200 
 
 225 
 
 026 
 
 052 
 
 078 
 
 104 
 
 130 
 
 156 
 
 182 
 
 208 
 
 234 
 
 027 
 
 054 
 
 081 
 
 108 
 
 135 
 
 162 
 
 189 
 
 216 
 
 243 
 
 028 
 
 056 
 
 084 
 
 112 
 
 140 
 
 168 
 
 196 
 
 224 
 
 252 
 
 029 
 
 058 
 
 087 
 
 116 
 
 145 
 
 174 
 
 203 
 
 232 
 
 261 
 
 030 
 
 060 
 
 090 
 
 120 
 
 150 
 
 180 
 
 210 
 
 240 
 
 270 
 
 031 
 
 062 
 
 093 
 
 124 
 
 155 
 
 186 
 
 217 
 
 248 
 
 279 
 
 032 
 
 064 
 
 096 
 
 128 
 
 160 
 
 192 
 
 224 
 
 256 
 
 288 
 
 033 
 
 066 
 
 099 
 
 132 
 
 165 
 
 198 
 
 231 
 
 264 
 
 297 
 
 034 
 
 068 
 
 102 
 
 136 
 
 170 
 
 204 
 
 238 
 
 272 
 
 306 
 
3i8 
 
 LOGARITHMS 
 Table of Multiples — (Continued) 
 
 1 
 
 2 
 
 3 
 
 4 
 
 5 
 
 6 
 
 7 
 
 8 
 
 9 
 
 035 
 
 070 
 
 105 
 
 140 
 
 175 
 
 210 
 
 245 
 
 280 
 
 315 
 
 036 
 
 072 
 
 108 
 
 144 
 
 180 
 
 216 
 
 252 
 
 288 
 
 324 
 
 037 
 
 074 
 
 111 
 
 148 
 
 185 
 
 222 
 
 259 
 
 296 
 
 333 
 
 038 
 
 076 
 
 114 
 
 152 
 
 190 
 
 228 
 
 266 
 
 304 
 
 342 
 
 039 
 
 078 
 
 117 
 
 156 
 
 195 
 
 234 
 
 273 
 
 312 
 
 351 
 
 040 
 
 080 
 
 120 
 
 160 
 
 200 
 
 240 
 
 280 
 
 320 
 
 360 
 
 041 
 
 082 
 
 123 
 
 164 
 
 205 
 
 246 
 
 287 
 
 328 
 
 369 
 
 042 
 
 084 
 
 126 
 
 168 
 
 210 
 
 252 
 
 294 
 
 336 
 
 378 
 
 043 
 
 086 
 
 129 
 
 172 
 
 215 
 
 258 
 
 301 
 
 344 
 
 387 
 
 044 
 
 088 
 
 132 
 
 176 
 
 220 
 
 264 
 
 308 
 
 352 
 
 396 
 
 045 
 
 090 
 
 135 
 
 180 
 
 225 
 
 270 
 
 315 
 
 360 
 
 405 
 
 046 
 
 092 
 
 138 
 
 184 
 
 230 
 
 276 
 
 322 
 
 368 
 
 414 
 
 047 
 
 094 
 
 141 
 
 188 
 
 235 
 
 282 
 
 329 
 
 376 
 
 423 
 
 048 
 
 096 
 
 144 
 
 192 
 
 240 
 
 288 
 
 336 
 
 384 
 
 432 
 
 049 
 
 098 
 
 147 
 
 196 
 
 245 
 
 294 
 
 343 
 
 392 
 
 441 
 
 050 
 
 100 
 
 150 
 
 200 
 
 250 
 
 300 
 
 350 
 
 400 
 
 450 
 
 051 
 
 102 
 
 153 
 
 204 
 
 255 
 
 306 
 
 357 
 
 408 
 
 459 
 
 052 
 
 104 
 
 156 
 
 208 
 
 260 
 
 312 
 
 364 
 
 416 
 
 468 
 
 053 
 
 106 
 
 159 
 
 212 
 
 265 
 
 318 
 
 371 
 
 424 
 
 477 
 
 054 
 
 108 
 
 162 
 
 216 
 
 270 
 
 324 
 
 378 
 
 432 
 
 486 
 
 055 
 
 110 
 
 165 
 
 220 
 
 275 
 
 330 
 
 385 
 
 440 
 
 495 
 
 056 
 
 112 
 
 168 
 
 224 
 
 280 
 
 336 
 
 392 
 
 448 
 
 504 
 
 057 
 
 114 
 
 171 
 
 228 
 
 285 
 
 342 
 
 399 
 
 456 
 
 513 
 
 058 
 
 116 
 
 174 
 
 232 
 
 290 
 
 348 
 
 406 
 
 464 
 
 522 
 
 059 
 
 118 
 
 177 
 
 236 
 
 295 
 
 354 
 
 413 
 
 472 
 
 531 
 
 060 
 
 120 
 
 180 
 
 240 
 
 300 
 
 360 
 
 420 
 
 480 
 
 540 
 
 061 
 
 122 
 
 183 
 
 244 
 
 305 
 
 266 
 
 427 
 
 488 
 
 549 
 
 062 
 
 124 
 
 186 
 
 248 
 
 310 
 
 372 
 
 434 
 
 496 
 
 558 
 
 063 
 
 126 
 
 189 
 
 252 
 
 315 
 
 378 
 
 441 
 
 504 
 
 567 
 
 064 
 
 128 
 
 192 
 
 256 
 
 320 
 
 384 
 
 448 
 
 512 
 
 576 
 
 065 
 
 130 
 
 195 
 
 260 
 
 325 
 
 390 
 
 455 
 
 520 
 
 585 
 
 066 
 
 132 
 
 198 
 
 264 
 
 330 
 
 396 
 
 462 
 
 528 
 
 594 
 
 067 
 
 134 
 
 201 
 
 268 
 
 335 
 
 402 
 
 469 
 
 536 
 
 603 
 
 068 
 
 136 
 
 204 
 
 272 
 
 340 
 
 408 
 
 476 
 
 544 
 
 612 
 
 069 
 
 138 
 
 207 
 
 276 
 
 345 
 
 414 
 
 483 
 
 552 
 
 621 
 
FORMING LOGARITHMS 
 
 319 
 
 Table of Multiples — (Concluded) 
 
 1 
 
 2 
 
 3 
 
 4 
 
 5 
 
 6 
 
 7 
 
 8 
 
 9 
 
 070 
 071 
 072 
 073 
 074 
 
 140 
 142 
 144 
 146 
 148 
 
 210 
 213 
 216 
 219 
 222 
 
 280 
 284 
 288 
 292 
 296 
 
 350 
 355 
 360 
 365 
 370 
 
 420 
 426 
 432 
 438 
 444 
 
 490 
 
 497 
 504 
 511 
 518 
 
 560 
 568 
 576 
 584 
 592 
 
 630 
 639 
 648 
 
 657 
 666 
 
 075 
 076 
 077 
 078 
 079 
 
 150 
 152 
 154 
 156 
 158 
 
 225 
 228 
 231 
 234 
 237 
 
 300 
 304 
 308 
 312 
 316 
 
 375 
 380 
 385 
 390 
 395 
 
 450 
 456 
 462 
 468 
 474 
 
 525 
 532 
 539 
 546 
 553 
 
 600 
 608 
 616 
 624 
 632 
 
 675 
 684 
 693 
 702 
 711 
 
 080 
 081 
 082 
 083 
 084 
 
 160 
 162 
 164 
 166 
 168 
 
 240 
 243 
 246 
 249 
 252 
 
 320 
 324 
 328 
 332 
 336 
 
 400 
 405 
 410 
 415 
 420 
 
 480 
 486 
 492 
 498 
 504 
 
 560 
 567 
 574 
 581 
 588 
 
 640 
 648 
 656 
 664 
 672 
 
 720 
 729 
 738 
 747 
 756 
 
 085 
 086 
 087 
 088 
 089 
 
 170 
 172 
 174 
 176 
 178 
 
 255 
 258 
 261 
 264 
 267 
 
 340 
 344 
 348 
 352 
 356 
 
 425 
 430 
 435 
 440 
 445 
 
 510 
 516 
 522 
 528 
 534 
 
 595 
 602 
 609 
 616 
 623 
 
 680 
 688 
 696 
 704 
 712 
 
 765 
 774 
 783 
 792 
 801 
 
 090 
 091 
 092 
 093 
 094 
 
 180 
 182 
 184 
 186 
 188 
 
 270 
 273 
 276 
 279 
 282 
 
 360 
 364 
 368 
 372 
 376 
 
 450 
 455 
 460 
 465 
 470 
 
 540 
 546 
 
 552 
 558 
 564 
 
 630 
 637 
 644 
 651 
 658 
 
 720 
 728 
 736 
 744 
 752 
 
 810 
 819 
 828 
 837 
 846 
 
 095 
 096 
 097 
 098 
 099 
 
 190 
 192 
 194 
 196 
 198 
 
 285 
 288 
 291 
 294 
 297 
 
 380 
 384 
 388 
 392 
 396 
 
 475 
 480 
 485 
 490 
 495 
 
 570 
 576 
 582 
 588 
 594 
 
 665 
 672 
 679 
 686 
 693 
 
 760 
 768 
 776 
 784 
 792 
 
 855 
 864 
 873 
 882 
 891 
 
Part IV— Tables 
 
 CHAPTER XXXI 
 
 EXPLANATION OF TABLES USED 
 
 § 362. Object of the Tables 
 
 Any value shown in the following tables* might have 
 been ascertained by the rules given in the text; but it is 
 convenient and time saving to have at hand, already worked 
 out, those results which are most frequently needed. 
 
 § 363. Degree of Accuracy 
 
 The tables shown give each value to eight decimal places, 
 while the ordinary tables extend only to five or six decimals. 
 This allows accurate computations to be made on sums up 
 to one million dollars, to the nearest cent — a degree of 
 accuracy which will meet any ordinary requirements. 
 
 § 364. Rates and Periods 
 
 The rates used in the tables* are as follows : 1%, 1%%, 
 11/2%, 1%%, 2%, 21/4%, 21/2%, 2%%, 3%, 31/2%, 4%, 
 4%%, 5%, and 6%. These are the rates most commonly 
 used, since most investments are on a semi-annual basis. 
 Rules for intermediate rates will be found in §§ 375, 376. 
 
 The periods given are from 1 to 50, inclusive, and also 
 
 • See Chapter XX2CII, 
 
 32Q 
 
EXPLANATION OF TABLES USED 321 
 
 every 5th period thereafter, viz.: 55, 60, 65, YO, 75, 80, 85, 
 90, 95, 100. Rules for obtaining the values for periods in- 
 tervening above 50, and for extending above 100 periods, 
 will be found in § 374. 
 
 In all the following tables of compound interest, the 
 principal is considered to be $1; for any other principal 
 the tabular result must be multiplied by the number of dol- 
 lars in the principal. 
 
 § 365. Tables Shown 
 
 Tables for obtaining the following results are shown in 
 Chapter XXXII. 
 
 Table I — Amount 
 
 II— Present Worth 
 III — Amount of Annuity 
 IV — Present Worth of Annuity 
 
 V — Sinking Fund 
 VI — Reciprocals and Square Roots 
 
 § 366. Annuities — When Payable 
 
 "Annuity" in these tables signifies the ordinary annuity 
 where the payment is made at the end of each period. This 
 kind of annuity is the one most used in investment calcula- 
 tions. Annuities paid in advance, like the premiums in life 
 insurance, are sometimes called annuities due (§75). Their 
 amounts and present worths may be derived from the tables 
 of ordinary annuities. 
 
 § 367. Table I — Amount 
 
 This gives the amount to which $1, invested now at the 
 rate i, will have accumulated at the end of n periods. The 
 rates (i) are at the top of the table and the numbers of 
 periods (w) are on the left-hand margin. Each term up to 
 50 periods is l-\- i times the term above it ; or is the term 
 
322 
 
 TABLES 
 
 below it divided by 1 + i. Each term may also be considered 
 as that power oil + i, the ratio of increase, whose exponent 
 is on the left. Thus in the column 3%, where i = .03, the 
 value for 9 periods is the 9th power of 1.03, or 1.03® = 
 1.30477318. If this be multiplied by 1.03 it gives the 10th 
 term, 1.34391638; if divided by 1.03 it gives the 8th term, 
 1.26677008. 
 
 § 368. Compound Interest 
 
 To find the compound interest, subtract 1 from the 
 amount. Thus the compound interest at 3% for 9 periods is 
 .30477318; for 25 periods, 1.09377793. It is unnecessary, 
 therefore, to give a separate table of the compound interest. 
 All the other tables might be derived from Table I. The 
 second line in each column is the ratio of increase. 
 
 § 369. Table II— Present Worth 
 
 This gives the present worth of $1 payable n periods 
 from now at the rate i ; or the principal which invested now 
 will at the end of n periods have accumulated to $1 ; or $1 
 discounted for n periods at i. It proceeds in exactly the 
 contrary manner to Table I, diminishing instead of increas- 
 ing, each term being divided by l-\- i to produce the succeed- 
 ing one, or multiplied by 1 + i to produce the preceding. 
 
 Each term may be obtained independently from the cor- 
 responding term in Table I, the two terms being reciprocals 
 of each other. If we represent any term in Table I by (I) 
 and the corresponding term in Table II by (II), then we 
 may say: (II) =1-^- (I) and (I) =1^(11); or more 
 briefly with negative exponents, (II) = (I)~^ and (I) == 
 
 (II)-'. 
 
 The second line in each column is the discount ratio or 
 reciprocal of 1 + f ; and each term below is the nth power of 
 
EXPLANATION OF TABLES USED 323 
 
 that number. Thus in the 3% column the discount ratio is 
 1.03-^ or .97087379; the present worth for 9 periods is 
 .76641673, or the 9th power of .97087379, which may be 
 expressed 1.03"^ or 1 -^ 1.03^ Multiplied by 1.03, it gives 
 1.03-^ or .78940923; divided by 1.03 it gives 1.03-"'' or 
 .74409391. Each of these multiplied by its correlative in 
 Table I will give unity: (II) X (I) = 1. 
 
 All these relations should be verified by experiment until 
 thoroughly understood. 
 
 The compound discount is obtained by subtracting the 
 present worth from 1. The compound discount for 9 periods 
 at 3% is 1 — .76641673 = .23358327. Since this operation 
 is easy, it is unnecessary to give a separate table of compound 
 discounts. 
 
 § 370. Table III — Amount of Annuity 
 
 This table gives the amount to which an ordinary annuity 
 will accumulate ; that is, if $1 be invested at the end of each 
 period, the total investment will, after n periods, reach this 
 amount. 
 
 It is formed from Table I by adding together the same 
 number of terms as of the periods required. The three top 
 lines of Table I give the third line of Table III ; the fourth 
 line of Table III is the sum of the first four lines of Table I ; 
 but for this purpose the line marked in Table I must be 
 counted in. Thus in the 2% column, 1 + 1.02 + 1.0404 in 
 Table I gives the value for 3 periods in Table III, 3.0604; 
 for 4 periods it is 1 + 1.02 + 1.0404 + 1.061208 = 
 4.121608; etc. 
 
 According to the principles laid down in § 60, we might 
 have proceeded in this way: Take the amount of $1 for 3 
 periods from Table I (not the third but the fourth line), 
 1.061208 ; drop the 1, giving .061208 ; divide by .02,^produc- 
 ing 3.0604. 
 
324 TABLES 
 
 But where the figures have been rounded, this procedure 
 would leave two places indeterminate. For example, the 
 amount of $1 for 20 periods is 1.48594740; the compound 
 interest is .48594740; this multipHed by 100 and divided by 
 2, gives 24.297370. We have, therefore, cut down our 
 result from 8 decimals to 6. But by addition of the first 20 
 lines of Table I, we get in Table III, 24.29736980; a gain 
 in accuracy of two places. 
 
 It will be better, therefore, to reverse the process and test 
 the accuracy of the table by dividing the result in Table III 
 by 100 and multiplying by 2. 
 
 24.29736980 X 2 -^ 100 = .4859473960 
 .4859473960 + 1 = 1.4859473960 = 1.4859474| | 
 
 This not only tests the accuracy of the table, but adds two 
 places. 
 
 This suggests that for very accurate and extensive com- 
 putations we may extend Table I to 10 figures, the last of 
 which will be nearly accurate. 
 
 For most questions of investment 6 decimals of Tables 
 III and IV will be ample. 
 
 When the amount of an annuity due is required, it is 
 obtained as follows : subtract one from the number of periods 
 and subtract one from the number of dollars. Thus we have 
 at 2% : 
 
 Amount of ordinary annuity, 4 periods, 4.121608 
 
 Amount of annuity due, 3 periods, 3.121608 
 
 § 371. Table IV — Present Worth of Annuity 
 
 This table gives the present worth of an annuity and is 
 derived from Table II, precisely as III is derived from I. 
 In the same way as before. Table II may be extended two 
 places ; but after multiplying by the rate, the result must be 
 subtracted from 1. 
 
EXPLANATION OF TABLES USED 325 
 
 The present worth of an annuity of 20 periods at 2% 
 is, by Table IV, 16.35143334, which X .02 = .3270286668; 
 1—. 3270286668=. 6729713332. Table II gives .67297133, 
 which is correct as far as it goes. 
 
 Table IV is the one used in bond valuations for ascer- 
 taining premiums and discounts which, as we have seen, 
 are merely present worths of annuities consisting of the 
 difference between the cash and income rates. Any ordinary 
 premium or discount where the principal does not exceed 
 one million dollars may safely be computed by using 6 or 
 7 figures of the decimals. 
 
 To transform Table IV of ordinary annuities into one 
 of annuities due, add one to the number of periods and add 
 one dollar to the value. 
 
 § 372. Table V— Sinking Fund 
 
 This table gives sinking funds. It answers the question : 
 What sum shall be invested at the end of each of n periods so 
 that the sum-total with all accumulations shall amount to $1 
 at the end of n periods ? 
 
 Each term of Table V is the reciprocal of the corre- 
 sponding term in Table III. (V) = (III)-\ Thus, to find 
 the sinking fund necessary to provide a total of $1 in 9 
 periods, we divide 1 by the total to which an annuity of $1 
 would accumulate in 9 periods. At 3%, the latter would 
 be: 
 
 10.15910613 ; 1 -^ 10.15910613 = .0984338570 
 
 which is the sinking fund required, carried two places 
 further than in Table V. 
 
 Another method of deriving the sinking fund would be 
 to divide the single interest (.03) by the compound interest 
 (.30477318) of $1 from Table I, which will be found to 
 give the same result : i-^l. 
 
326 TABLES 
 
 § 373' Rent of Annuity 
 
 To find what annuity has a present worth of $1, we 
 have only to add to the rate of interest the sum taken from 
 Table V. This gives the rent of an annuity which $1 will 
 purchase, and it is, therefore, unnecessary to provide a 
 table for that purpose. It might also be obtained to 8 
 places from Table II, dividing the single interest by th? 
 compound discount. It could also be derived by finding 
 the reciprocal of the corresponding term in Table IV. 
 
 § 374. Extension of Time 
 
 The tables go as far as 100 periods only, but Tables I 
 and II may be extended to as many periods as desired by 
 multiplication. The values for 148 periods might be ob- 
 tained by multiplying together those for 100 and 48 periods 
 respectively. Thus, at 1%, Table I, we have: 
 
 100 
 
 2.70481383 
 
 48 
 
 1.61222608 
 
 Using contracted multiplication, 
 
 2.70481383 
 
 
 1.62288830 
 
 
 2704814 
 
 
 540963 
 
 
 64096 
 
 
 5410 
 
 
 1623 
 
 
 22 
 
 
 4.36077141 
 
 The last figure is not quite accurate, but we could have 
 made it more so by getting 10 figure values for 100 and for 
 48 periods from Table III. 
 
EXPLANATION OF TABLES USED 
 
 327 
 
 100(170.48138294X.01=1.7048138294)+1=2.7048138294 
 48 ( 61.22260777X01= .6122260777)4-1=1.6122260777 
 
 2.7048138294 
 
 1.6228882976 
 
 270481383 
 
 64096277 
 
 5409628 
 
 540963 
 
 162289 
 
 1893 
 
 189 
 
 19 
 
 Correct result to 10 figures, 4.3607713911 
 
 To extend Table III, IV, or V as to time, it is easiest 
 to extend Table I or II and thence derive the value required. 
 
 § 375* Subdivision of Rates 
 
 Although the rates given in these tables are those most 
 frequently required, yet it often happens that intermediate 
 rates occur, especially in bond computations. It might be 
 supposed that these inter-rates could be obtained by "split- 
 ting the difference" into as many parts as necessary. But 
 a trial will show that this gives only a rough approximation. 
 
 In Table I, for 10 periods at the rate 3%, the amount 
 
 is 1.34391638 
 
 and at 2%% it is 1.28008454 
 
 Midway between them is 1.31200046 
 
 but this is not the true value for 23^% ; it is. . 1.31165103 
 
 hence the error must be .00034943 
 
 and the approximation holds good for only 3 decimals. But 
 the correction can be very closely computed. 
 
328 TABLES 
 
 § 376. Interpolation 
 
 Sometimes, in compound mterest processes and also in 
 mathematical problems, we have a series of terms, all 
 formed by the same law, and based upon another series. A 
 familiar illustration in mathematics is the formation of 
 squares, for example : 
 
 Numbers, 12 3 4 5 6 etc. 
 
 Squares, 1 4 9 16 25 36 etc. 
 
 1st Differences, 3 5 7 9 11 etc. 
 
 2nd Differences, 2 2 2 2 etc. 
 
 When a series of terms such as that described above is 
 written down in a table opposite to certain equi-distant num- 
 bers called arguments, intermediate terms corresponding to 
 certain given arguments may be inserted by a process called 
 interpolation, consisting of three steps : 
 
 (1) Differencing. 
 
 (2) Multiplication of each difference by a fraction de- 
 
 pendent on the fractional distance at which the 
 inter-term is to be located. 
 
 (3) Application of these corrections to the preceding 
 
 term. 
 
 Differencing has already been treated to some extent in 
 §§250 and 276. To interpolate in Table I, 10 periods, 
 a value for 2%%, we first set down the two values next 
 greater and next less, opposite their arguments (3% and 
 21/2%). 
 
 3% 1.34391638 1, . ^ 
 
 ^ hdecreasmsf terms 
 
 21/2% 1.28008454 J ^ ^ ^ ^ "^ 
 
 or 
 21/2% 1.28008454 1 
 3% 1.34391638 J 
 
 mcreasmg terms 
 
EXPLANATION OF TABLES USED 329 
 
 The decreasing series has some advantages which make 
 it preferable. 
 
 Continuing the cokimn, use only equi-distant arguments, 
 for 4 or more lines. 
 
 3% 
 
 1.34391638 
 
 
 
 21/2% 
 
 1.28008454 
 
 
 
 2% 
 
 1.21899442 
 
 
 
 11/2% 
 
 1.16064083 
 
 
 
 1% 
 
 1.10462213 
 
 
 
 y2% 
 
 1.05114013 
 
 
 
 0% 
 
 0.00000000; 
 
 
 
 
 and 
 
 proceed to difference. 
 
 
 
 
 Dx D3 
 
 D. 
 
 z% 
 
 1.34391638 
 
 .06383184 .00274172 
 
 .00010519 etc. 
 
 21/2% 
 
 1.28008454 
 
 .06109012 .00263653 
 
 etc. 
 
 2% 
 
 1.21899442 
 
 .05845359 etc. 
 
 
 11/2% 
 
 1.16054083 
 etc. 
 
 etc. 
 
 
 Let this process be carried out to the 6th difference and 
 we have the following values, which are all that we need 
 to consider: 
 
 D: .06383184 
 
 D, .00274172 
 
 Ds .00010519 
 
 D; .00000355 
 
 D, .00000010 
 
 D. .00000001 
 
 From these differences any value corresponding to rates 
 between 3% and 2%% may be determined. Each D will 
 be multiplied by a certain fraction (F) according to the 
 
330 
 
 TABLES 
 
 fractional distance from 3% where the interpoland is to be 
 located. 
 
 For the distance .5 (which means halfway), the F*s are 
 always as follows : 
 
 R .5 
 
 F. .125 
 
 Fs .0625 
 
 R .0390625 
 
 F5 .02734375 
 
 Fe .0068359375 
 
 Multiplying each D by its corresponding F : 
 
 Di X Fx = .06383184 X .5 = .03191592 
 
 D3 X F. = .00274172 X .125 = .00034271 
 
 Ds X Fa = . 00010519 X. 0625 =.00000658 
 
 D4 X F4 = .00000355 X .0390625 = .00000014 
 
 D5 X F5 = .00000010 X .02734375, 
 
 which is too small to affect the final 
 
 figure. 
 De X Fe, and following products are also 
 
 negligible. 
 
 Total correction, .03226535 
 
 Subtract from value at 3%, 1.34391638 
 
 Interpolated value at 23^%, 1.31165103 
 
 By using the above series of F's (.5, .125, .0625, 
 .0390625, etc.), any interval may be bisected. But the inter- 
 val may also be split into 5 parts as well as into 2. ^ = .2 ; 
 therefore .2 would be Fi for the first 5th, .4 would be Fi for 
 the second 5th; and .6 and .8 would be Fi for the third and 
 fourth intervals, respectively. 
 
 We will now give the proper F's for interpolating nine 
 values, each at one-tenth interval. 
 
EXPLANATION OF TABLES USED 
 
 331 
 
 R 
 
 F, 
 
 F. 
 
 F. 
 
 F. 
 
 .1 
 
 .045 
 
 .0285 
 
 .0206625 
 
 .01611675 
 
 .2 
 
 .08 
 
 ,048 
 
 .03360 
 
 .025536 
 
 .3 
 
 .105 
 
 .0595 
 
 .0401625 
 
 .02972025 
 
 A 
 
 .12 
 
 .064 
 
 .04160 
 
 .029952 
 
 .5 
 
 .125 
 
 .0625 
 
 .0390625 
 
 .02734375 
 
 .6 
 
 .12 
 
 .056 
 
 .03360 
 
 .022848 
 
 .7 
 
 .105 
 
 .0455 
 
 .0261625 
 
 .01726725 
 
 .8 
 
 .08 
 
 .032 
 
 .01760 
 
 .011264 
 
 .9 
 
 .045 
 
 .0165 
 
 .0086625 
 
 .00537075 
 
 To find the value corresponding to 2.60% in the same 
 table: Since the interval is .50, }i of the interval is .10, and 
 the intermediate arguments would be 2.90% at .2 distance 
 from .3 ; 2.80% at .4 ; 2.70% at .6 ; and 2.60% at .8. There- 
 fore, we must use the F's of .8 as above, multiplying by 
 them the same differences previously obtained. 
 
 .06383184 X. 8 
 .00274172 X .08 
 .00010519 X .032 
 .00000355 X .0176 
 
 The remaining terms are negligible. 
 
 Total, 
 
 Subtract from value at 3%, 
 
 .05106547 
 .00021934 
 .00000337 
 .00000006 
 
 .05128824 
 1.34391638 
 
 Interpolated value at 2.60%', 1.29262814 
 
 Had we chosen the increasing series in our differencing, 
 there would have been this variation in the application of 
 the corrections, that the first, third, fifth, seventh, and all 
 odd-numbered corrections would have to be added to the 
 preceding term and the even-numbered ones subtracted. 
 
 We should have differenced thus : 
 
332 
 
 TABLES 
 
 
 
 D. 
 
 D. 
 
 D. 
 
 21/2 
 
 1.28008454 
 
 .06383184 
 
 .00285054 
 
 .00011260 
 
 3 
 
 1.34391638 
 
 .06668238 
 
 .00296314 
 
 etc. 
 
 3% 
 
 1.41059876 
 
 .06964552 
 
 etc. 
 
 
 4 
 
 1.48024428 
 etc. 
 
 etc. 
 
 
 
 The D's and their products would have figured thus, in 
 the first example : 
 
 2%% (now the basis) 1.28008464 
 .06383184 X. 5 + .03191592 
 
 .00285054 X .125 
 .00011260 X. 0625 
 
 1.31200046 
 
 — 35632 
 
 1.31164414 
 + Y04 
 
 1.31165118 
 
 — 15 
 
 .00000388 X .0390625 — 
 
 234%, as before, 1.31165103 
 
 The F's already given are generally sufficient for any 
 practical purpose, but even if a very unusual fractional rate 
 requires computation, the F's may always be worked out 
 by the following formula : 
 
 Fi is always the distance from the first value, expressed 
 
 decimally. 
 Subtract Fi from 1, multiply Fi by the remainder and 
 
 divide the product by 2 ; this gives F2. 
 Subtract Fi from 2, multiply F2 by the remainder and 
 
 divide the product by 3, giving F3. And so on. 
 
EXPLANATION OF TABLES USED 333 
 
 Observe that it is always the original Fi which is sub- 
 tracted from 1, 2, 3, etc., and that the divisor is always the 
 number of the F sought. 
 
 This will be plainer in symbols. 
 
 F. = F.X(1 — FO 
 F, = F.X(2 — FO 
 F. = F3X(3 — FO 
 F. = F.X(4 — R) 
 etc. 
 
 Fn = Fa_x X (n — 1 — FO - n 
 
 The F's already given should be worked out for practice 
 by these formulas. 
 
 As an example, we give the F's of .24. 
 
 Fx = .24 
 
 Fa = .24 X 0.76-^ 2 = .0912 
 
 Fa = .0912 X 1.76 -f- 3 = .053504 
 
 F. = .053504 X 2.76 -^ 4 = .03691776 
 
 F5 = .03691776 X 3.76 ^ 5 = .02776215552 
 
 Where the rates given in the tables are more than 1/2% 
 apart, interpolation is not practically useful. 
 
 § 377. Table VI — Reciprocals and Square Roots 
 
 This table gives the reciprocals and the square roots of 
 120 of the most necessary ratios of increase. 
 
 The ratios begin at % of 1%, and increase by 40ths of 
 1% to 3% ; by 4ths of 1% to 7% ; and by 1% to 10%. 
 
 The second column, composed of reciprocals, gives the 
 present worth of $1 payable one period from now, like the 
 second line of Table II. It is used for the purpose of dis- 
 counting by multiplication rather than by division, the 
 former operation being much easier. Any reciprocal may 
 
334 TABLES 
 
 j 
 be tested by multiplying it by the ratio standing opposite, 
 which will give as the result, unity. 
 
 The third column, composed of square roots, gives the 
 equivalent effective ratio for a half-period. Thus for an 
 obligation at 6% semi-annually the ratio of increase is 1.03. 
 If a quarter of a year (a half-period) has elapsed, the 
 amount, if scientifically treated, is not 1.015 as used in 
 actual business, but 1.01488916. If the loaner were to re- 
 ceive 1.015 as the amount after three months and reinvest 
 at the same rate, he would have, at the end of the half- 
 yearly period, not 1.03 to which he is entitled, but 1.030225 
 (=1.015^). But if he receives 1.01488916 and reinvests 
 for the other quarter at the same rate, he will have at the 
 end of the half-year 1.01488916' = 1.03. 
 
 In other words, if .03 is the rate for each period, the 
 equivalent effective rate for a half-period is .01488916. To 
 receive or pay 3% each half-year is exactly the same in 
 effect as receiving or paying 1.488916% each quarter. 
 
 Intermediate values in the second and third columns may 
 be readily found by interpolation, usually requiring only 
 one F. 
 
CHAPTER XXXII 
 
 TABLES OF COMPOUND INTEREST, PRESENT 
 
 WORTH, ANNUITIES, SINKING FUNDS, 
 
 AND OTHER COMPUTATIONS 
 
 335 
 
336 
 
 TABLES 
 
 ^ 
 ^ 
 
 COON T-HCMiOOr^ "^voo^rj-r^ 
 
 VOOO CM-^t^ONON vovoooooo 
 
 u-)QC^ 00 fO u-i CN) CVJ rfvOOOT-HfO 
 
 C^O\'-i 00\000^ OOCOOO'-Ht^ 
 
 VOOOOO Tj-MDvOTfOO OOOOiOON 
 
 lOOVOcO t-hOncOCOOO ocm^oocm 
 
 C^iOt^O COiOOO-— i'^ 00 '-I Tt- t^ --H 
 
 OOOr-i T-H ,— I ,-H CO <M CMfOcOcO''^ 
 
 OOiOOOOOO 
 
 00 Tj-^ OS 00 
 
 Tj-00CMlOO\ 
 
 ■^loooom 
 
 -^OOTj-voOv 
 
 •-H 00 r^ '-I CO 
 
 00 ON '-'■^00 
 
 fOt>»C0 VOO 
 ^ vOt^t^^OO 
 
 OOCMCOO 
 
 ■^roo>otv 
 
 Tfo\oo\c 
 
 ONOOOOTfTj 
 iOO'^ONTj 
 
 OOOnOnOnC 
 
 rOr-HfO ^TfO'-lOO TflOONr-lr^ 
 
 ^ VOOCO t^tOONT-HTj- COOO\VOCO 
 
 >!. O«r)00 t^cgroro^ O'— '-^cooo 
 
 NT toiOOO ^OOiOOOt-^ CMCOQTj-Tl- 
 
 CMTtVOQN '-htJ-^OnCM '^rft^OcovO 
 
 OOOO T-H r-( r-H ,-H CM C\J CM CO CO c^ 
 
 O^-^MDt^ OvOCMt>^-0 CMCMOOOni/ 
 
 00 -^ ON 1— I CO CMVO'— 'COU-) covooOOnC 
 
 VO'-HCMt^O 0\OCMt-HV0 vOOMOrfts 
 
 OrO-^OOr^ OCMCMCOVO 'rtOO^-rtO 
 
 CM^f^iOr-i io\0"^CMr^ '-I CO IT) lo T) 
 
 V0I>*0nCMV0 QtO<— lOOm rfcocOTj-vr 
 
 OnCMioOnCM ^OncovOO "^OOCMvOC 
 
 co-<^-*tJ-io lOiOVO^t^ t^t^ooooo 
 
 VO OCMt^OOr^ CM'-"a\C0\O ^J- --h cm lO in. O^^tN-VOiO O\r-i00»-<0 
 t-H OO'^VOcotO "^cot^vot^ cot^'^CM'-" '^covOCMCM On i-" tJ- CM VC 
 OOCM 0(M>r>ON(N TfTt-^vOOO OOO^vOt-i t^vOONONt^-. ioOOvOtJ-' 
 ^ VOOO'^'^^ ^ — ~ '- ^ 
 
 CM 
 
 ■^ VO r^ On CO 
 
 oco oovoooiooN ONt^Ttor^ NOi 
 
 SCNjTd- O'-HVONOO ONCorovOTt 001 
 
 T-iCM '<*• VO 00 T-i uo OOCOOOCOCJN >J^ ' _ _ _ _ 
 
 CM'^VOOO OCM'^t^C^N "-HTt-voON^ ^t^OCMiO 00 i-h rM^ O rftN.O'^t^ 
 
 OOOO ,-1 T-H ,-1 T-i ^ CMCMCMCMco co CO -^ ■<*■ tJ- '^mmxno NOvOt^t^fN 
 
 vOrfOOOa 
 OcovO'-Hir 
 
 fin 
 
 I 
 
 o 
 
 H 
 
 o 
 
 iO'thco VO lO u-> 00 '-• ONt^i-HOCM voirj^^o O t-i ^ VO O^ -^OvOOCV 
 
 ^ 
 ^ 
 
 
 ^ 
 ^5^ 
 
 lOCO'-Hf^CO Tj-f^cotoOO OOcO'-i^ 
 VOCMC^I'-Ht^ TfOvONONVO r^OvOO 
 
 OCMiO '-lOCMOOOO r^LOCO00'-^ CM CM CM co tJ- 
 
 lOCO'^OO VOlN»^00ON Tl-CM-^^ONON CMOnO>JT^ 
 
 t^Loco^ OOnOvOOOO On O '-h cm -"^ t^ ON co vo O -^ On rf o vo CMOnKi/) 
 
 ^ -"^ VO OOr- (coior^ On T-H Tt VO On >— i co vo On t-h -"^voOnCV) 
 
 . CMOOt^Tj-r^ iovocoonvc 
 
 to OOvooOt-iCM QCMt^CMt^ 
 
 t^coCMVOrJ- OOOOtOr-Hii- 
 
 t^iot>*coTj- On 0\ Tt Tf « 
 
 r-HCOLOt^ONOCM _ __ 
 
 OOOO o '-"'-' --H '-" '-iCOCMCMCM CM co co co co "^ "^ -^ Tf- lo mmiovOvC 
 
 00 lO 
 
 CO>r) 
 
 IT) 00 CO 
 CMt^vo 
 
 •IT) rlCOOlOi-H irjCOOOOO' 
 It^ O00t^»-H00 CO irj ,— I r-H U- 
 
 - tOt^cor^CM ioc?nqcmc 
 
 CM a 
 
 cOtJ-CMON OOOOOCMvo CMioOOO 
 
 _ ,^tJ-OnOO Ttrti-^miO cOoOCM-rt-iO lOiOVOr^O Tt-O'-.-. 
 
 CM VO CO CM Tt- OO '^j- CO lOONVOmtN. CM On O co On OOOiOCOvo CTNt^OOCOO 
 
 lOOLOi-t r^coONVOco Qt^tOCOr-H oo< ~ — " ■" ~ 
 
 r-(CO^vo f^ONOCM^ vSwONr-HCO ipv^ -_.. . -. 
 
 OOOO O O '-<'—' '-< 1— 1 1-H t-H CM CM CMCMCMcoco CO co CO tJ- t^- rf tJ- t}- in ir 
 
 iOOtJ- lOOOt^OOO COCMCMtOiO OOiOt^ONi-t coOOOQnij^ rJ-mCMO'- 
 
 CM^>.co r-H ^ Tt r-i r-i oOCMiOONt^ t-Hvoi-HCOVO CM t^ "^ o o oncooncocv 
 
 VOOiO CMCOOVOCM O-^-^co-^ ONON00r>.ON r^CMOQf^'-H CMiOOCMCv 
 
 lOt^Tf OOOOtOOOON t^CM^OVOtO CMOOCOr^O COVQOO'-Hm ON'^'-'ONO 
 
 lOt-HONQN OCOOO-'^CM CM-^t^CMON OOOO'-'iOCM ~ " '" -- 
 
 CMiOt^O ■"^t^O'^OO CMVOOloOn -^CTnloovo 
 
 T-iCMcoiO vot-^ONOr-^ co-^vot^OO O^coiovo 00 On r-* co rj- vd 00 On '-' cr 
 
 OOOO 000'-''-< T-H ,-1 ^ ^ T-^ CMCMCMCMCM CM CM co co co CO CO co "^ rt 
 
 OOCMt^co i-hCMioOnvC 
 
 CM oo Tf o r^ 
 
 COtOCf 
 
 rH IT) VO lO T-H ^N, COiOCOOO'-i VOt^COOOiO 
 O 0»-"Cor^CM »-HCOOCMC^l OnvO'^'^ON 
 
 •Tl-voCMm O' 
 
 '-i'^ OO^ovOiO CvJ 00 to CO '^ OOOO'^t^OO _ 
 
 OO 1— iCMcotooO CMVOCMONf^ vo t^ O -^ O On On '-h VO CO coioOOnC 
 
 1— I CO VO Oto,— lOOVO vovOOOOtI" OniocO'— i»-h i— i co 1>» '— i t^ rj- CM CM CM iT 
 
 OOO '-Hi-HCMCMco -^tnvooOON OCM"^VOOO O CM '^ t^ ON CM to 00 --' -^ 
 
 '-HCMCO'^ tovOt^^OOCTN O'-'CMCO'?*- vo t^ 00 On O CM co ''t to VO 00 ON O CM cc 
 
 OOOO OOOOO T-H r-H T-H T-( r-( ^ r-H r-^ ^ CM CMCMCMCMCM CMCMCOCOc: 
 
 
 00 
 
 CO 
 000 
 
 Ot-^CMco-* lOVOr^OOON OrHCMfO-* iri\ot-^COO\ O-^CMcorf »J^'Ot>oqON 
 ^^T-trHf-t ^T-trHr-H,-l CMCMCMCMCM CM CvJ CM CM CM 
 
 f 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 337 
 
 vot^ONOO^ 
 
 mor^ 00 fo 
 
 t^ O f*^ OO^o 
 
 O'—CvJCVJCO 
 
 cvj c4 csi csi cvi 
 
 a\<Mooqoo 
 lo m cx) Cvj Tj- 
 
 O rOr^COt>N 
 
 c4 cvj cvi cvi cvi 
 
 Tt roOCX)00 
 OCI-CNOO 
 fOOiOOOO 
 vOCAOnCNO 
 O '-' OMJ^OO 
 LOCVl O '— ' <^ 
 CO"^C\J OnVO 
 vor^oooo On 
 <\i (\i c4 cvi og 
 
 OOVO fOVOO 
 
 rq CX3 '-< lo CO 
 
 fOOt^ ON vO 
 OiOONOOf^ 
 ON 00 vO"^ CM 
 t>x CO r-. T-H ro 
 CO '— ' ONt^iO 
 
 p t-H T-H CM CO 
 
 CO CO fO CO fO 
 
 CMPOiOVOVO 
 t^Ot^CMOO 
 
 00 CO 0\ 00 CM 
 
 or^ooioo 
 
 i-.t^t^ON'-i 
 
 r^oooNt-^CM 
 
 CO 00 On t^ CO 
 
 TfoqcoONvq 
 
 COfO'^TfiO 
 
 coCM-^coio m 
 
 TtOOCM COOO CO 
 
 t^t^ rfvOco VO 
 
 O ^ vOiO O '— I 
 
 cmioonoovo r>. 
 
 CM Q\NO00^ CO 
 
 X^OIOCMtJ- .-1 
 
 COCM^CM-^ 00 
 
 vdKodoNC) '-< 
 
 Tj- <7\ CO Tt- lO vOCMOnOnO I^ogoOO'^ 0\0'-"-'0 OOOnOOO lO O CM CM ^ O 
 
 Tj-r^OCOTf lOrt-CMCJNON ONt^CgTtTj- coonconOio rl-rl-r^OOTt OcOi-hOOCM CO 
 
 cOTfcoOON covOCMiOCM COOmO"^ vO lO co ON ^ NO r^ rt vO ,-i TfiO^rN.0N no 
 
 CMOONOTf ON'-htI-OnO OOOOOOnNO m On '— ' co O -rf CM co CM t1- t^ Tt" On lO O "^ 
 
 cocM-^ONOo t^oooN'-'No «-ionOcmoo x^onvono^ oO'-'CO'-h r^'-Ho^c^^>. cd 
 
 OncoOOcoO OOl^t^ON^ iOC^nocot-i »-HCMtOONiO CMOOt^r^ vnOt^r^ON ■^ 
 
 tKTncooOco I^CMr^CMOO coCOrfQNO CMOO-^Ot^ TfOO"^"^ OCOCNJCDJ^ »0 
 
 OnOnOO'-' t-iCMCMCDco tJ- rf lo VO VO r>» t^ 00 ON CTn O Tf 00 CM t^ CO On NO rt; CM CM 
 
 .-J»-^CMCMCM CMCMCMCNJCM CM'cmCMCMCM CMCMCMCMCO cococOTfTt \n\n\6t^o6 On 
 
 OOCMOnOco 
 lOOOuT^O 
 t-iCOO'-ivo 
 NOCO^l-cot^ 
 CO U-) U-) CM NO 
 i-Hl-^ rj- CM O 
 i-H Tt CO C^^ NO 
 OOOOOOOvON 
 
 lOTj-ONCTst^ 
 lOCOOt^t^ 
 
 ONt^iO COtJ- 
 OOOOOOOn-'^ 
 OOOOVOCMt^ 
 OnOnQCMtJ- 
 On CO 55 CM NO 
 OnO O '— ' »-< 
 •-h' CM CM CM CM 
 
 OCMCM '-I O 
 00 CVI t^ CO O 
 O lo On Tj- On 
 CM CM CM CO CO 
 ^4 CM CM CM CM 
 
 1— ( On '— I On On 
 CMCMiOfOl^ 
 
 Tfr-H COO^ 
 
 00 VOCOOOO 
 
 t^ NO NO r^ 00 
 
 CO 00 CO 00 CO 
 Tt r^ LO li") NO 
 CM CM Cvi CM CM 
 
 coi^ONf-iCM 
 
 ONorN».-HCM 
 
 OOOOCOOO 
 00 coco CM lO 
 LOI^ Ol-OtO 
 
 ^^,-hCMON 
 On r^ 00 CM c^ 
 NO On CM NO ON 
 
 OOrtOO'-'NO NO 
 
 u-)ioCM C0 1— 1 T:^ 
 
 i-it^OOTfNO Tt 
 
 tj-oococtmo cm 
 
 CMCMCOCOCO ■^Tj-miONO t^ 
 
 CO CO On CO CM 
 
 "-H T-H Tj- CM lO 
 
 OCTncoCM ■'^ 
 OTt-HOCM 
 OOCM (Mt^t^ 
 CM CM CM CM CO 
 OOT^^t^O 
 
 Not^r^t^oo 
 
 Ot^ON^Tf 
 
 r^ CM 00 "^ 00 
 
 Cht^NOOO T^ 
 COOOOcot^ 
 CMrfOcOi-i 
 LO t^ Q CO l^ 
 
 CONOOCONO 
 
 OOOOCAONCTs 
 
 Tj-O-'^OOv 
 cocoCM On T-H 
 
 r^ioNOOO 
 
 ON CM NO coco 
 lONOCMLOTt 
 
 '-" NO CM 00 lO 
 O CO t^ O "^ 
 
 CM CM CM CM CM 
 
 CMOOOnCMO 
 CM CM 00 t^t^ 
 
 VOt^t^OOr-H 
 
 t^l^Tt OntT 
 
 ON^-i o^ooo 
 CM'-hOOnON 
 00 CM NO On CO 
 '-H CM CM CM CO 
 
 coiooo-^t^ 
 On 00 CM t^ CM 
 OOt^NOiOOO 
 OOC^Ii-tCMOO 
 
 r^iooO'si-CM 
 
 ONO'-^OOOO 
 CO On CO 00 NO 
 COIOOOOCO 
 
 OOCMOO'^ Tt 
 
 ONONTj-OOCM C?N 
 
 O '-Ht^OCO ii-> 
 
 '-H ONCOOOO u-> 
 
 inco-rr coCM T-i 
 
 cONOCMOt^ 00 
 
 t^QNONOON NO 
 
 NOOCOt^'-H NO 
 
 CMCMCMCMCM CM CM CM CO co CO "* tJ- rj- lO lo 
 
 CMCMCMOOt^ CMTj-COOOiO »-« 00 CM CM CM 
 
 CM"^co.-ico covoNOCMCM "^ vo t-h 00 O 
 
 ONOtJ-OnNO ^C^nOOOO COCOr^ONCO 
 
 OOCMCMt^ON OOcot^ON'— I T-HCMrM^co 
 
 0"^fOTl-0\ OO^t^r^CM CDCMOOOOco 
 
 coNOOtI-CO coO\"^Qr^ ^r-iCONOiO 
 
 NOOO'— 'COiO OOOCOVOOO ^TtNOCTvCM 
 
 lOiOVONONO vot^t^r^t^ COOOOOOOOn 
 
 ^^OOnno 
 OCM'-hCM"^ 
 
 CONOCAOOO 
 
 r-HCMt^r^CO 
 CM to CM Tj- r-H 
 
 •^COCOCOTt 
 
 to 00 '-< rj- t>x 
 C?nOnOOO 
 >-; T-I CM CM CM 
 
 CMcoOni-hno 
 
 Tj- Tt- i-H Tl- lO 
 
 CMCMCMCMCM 
 
 '-iOnOO'-h'^ lO 
 tV.t^COlOr-1 VO 
 
 t-HCMOOOOCM VO 
 On NO t^-^ On 
 ionoOnOno 
 -^O-^OOrf 
 
 ■ t-H ,-H CO 
 
 to (_ 
 
 O CM to 00 i-H 
 
 CO CO CO CO -^ 
 
 R 
 
 NOcO'-HTfON t^CMCMOOtN* VO »-* t>» to i-H 
 
 cotoiO^CM OOOO^t^OO Ttt^l^OOCM 
 
 COOOOCMNO tococONOr^ C?N-^NO00rf 
 
 T-HiococOVO COtJ-OnOOCM ^vONOCMto 
 
 NOr^'— it^to voOn-^CMco no '— ' CTn 
 
 .— lOvooNOto Tj-cocococo co'^l-T^ 
 
 toNOCOOCM TfNOOOOCM Ttvo " 
 
 TfTfrflOlO tOtOLONONO NO NO 
 
 CO 
 
 OOOCM 
 \Ol^t>^ 
 
 Tf^vVOtOON 
 
 »-iONOoot^ 
 
 NOt^ CO Tj- VO 
 
 "^O-^to-rf 
 
 OnOO OCOQ 
 OOOCMtoOO 
 Tl-t^ ON T-H CO 
 
 t^t^t^oooo 
 
 t^ Oiot^l^ 
 
 cot^coOO 
 
 CMCO00r-H5N 
 
 OCM '-H CMOO 
 y-> Ot^CMtO 
 NOCOOrJ-00 
 OOONt-hCM CO 
 '-h' »-; cvj CM CM 
 
 tOONONVOOO CM 
 corfr-Hr- 
 OnOOO' 
 r^TfNooO' 
 
 CO Ot>>toio VO 
 tot>s OOOCM Tt- 
 CMCMCMCOCO CO 
 
 CMOOOOnOn vO00t>^Tti-t coi-xOvOvr^ to to rj- 00 Tj- CMt^OONt^ 
 
 ONTfNDOON t^f^-^CNlto t^coOOt^iO t^OOrJ-Oco 00 to t^ Tt CO 
 
 OOt^OONO CMOONOt^CM CO CM On t^ r^ O 00 co NO 00 '-i Tt NO NO CO 
 
 TfCM-^ONt^ ONOt^CMCM NOiOCOt^'— ' r-( to VO CM rj- CO CM ON NO NO 
 
 OOcoONVOto NOt^OtO^ OOX^t^ONCO OC^CMCMco vo to NO co l\ 
 
 tv^^Tl-OOCM NOOtOON-"^ OOcoOOcoOv tT O NO CM 00 Tf 00 NO On NO 
 
 Ti-NOt^coo '-icoTfior^ ooOr-icoTi- noooont-hcm -^cM'-'OO 
 
 CO CO CO CO tJ" Tf TJ- Tt tJ- T^ Tj-tOlOtOtO tOtOLONONO VOt^OOONO 
 
 ^^^^r^ ^r-ir-i^^ ^^'^^^ ^^^^^ ^^^^CM 
 
 tN.CMt^ 
 
 Tt-CN] C?\ 
 
 00tOC3N 
 CM '-'OO 
 
 CDnvoOn 
 O'-'CM 
 i—CMco 
 
 t^lO CO 
 
 NOtO 00 
 
 CMt>x CO 
 
 CO CO »-H 
 
 NOlo 00 
 
 OOco rf 
 
 Tj-t^ O 
 
 Tl- to t^ 
 
 CMCMCMCMCM CM 
 
 O'-iCMCOTt tONOt^OOCN O^-hCMco 
 cococococo cococococo '^'^rf"^ 
 
 Th tovotv.00ON OtoOtoO tOQlOOtO 
 -^ '^'^-^"^"^ totONONOt^ t^OOOOONON 
 
338 
 
 TABLES 
 
 
 
 
 VO 
 
 00 »-" vot^N VO 
 
 Ovot^vovo 
 
 On 00 C3NtoO 
 
 t^OCM VO-^ 
 
 CM VO -TfOO, 
 
 
 
 
 On 
 
 tOi-iCMOOv 
 
 t^to-^CM Ov 
 
 r-H vot^ '-'to 
 
 Tf VOTl-VOVO 
 
 t^ ON CM^ On 
 
 
 
 
 VOVO 
 
 tOOvOCO 00 
 
 r^oo VO 00 CO 
 
 CO -H CM ON On 
 
 to cot^C^'* 
 
 O CM tn \0 t-^ 
 
 
 
 
 T-Hl^ 
 
 
 tJ-OnOnCMO 
 
 to to t^ CO ON 
 
 CO vocOTt ro 
 
 r^ CO ^00 00 
 
 
 
 •..o 
 
 vOO "^ 
 
 oocM T-^ a\CJ\ 
 
 to CO t^ CO to 
 
 T— 1 lo to r^ ON 
 
 OOcoco VO CO 
 
 
 
 ^ 
 
 roi=H(N 
 
 OOOOcoroOv 
 
 poo CM CM O 
 
 a\Ov^-<<o VO 
 
 VO O C^J -^ to 
 
 t-. On CO On 00 
 
 1— 1 On cvj r-H 00 
 
 
 
 VO 
 
 VOCN) On VO 
 
 CO T-H OC3N00 
 
 On ''^ On to CM 
 
 OOnO— 'Tf 
 
 0\ -^ CV) Y-n-i 
 
 
 
 
 T-H ^ T-H T— 4 r-5 
 
 fOTftoto\q 
 
 t^OOO '-'CM 
 i-;r-;CMCMCM 
 
 COtovOCO o 
 CM CM CM CM CO 
 
 CM CO vqoq p 
 
 CO CO CO CO tJ" 
 
 CM to CO '-' ■>* 
 •Tt ■^■^tou-j 
 
 
 
 
 m 
 
 VO-^CM -^CM 
 
 CO vOcO'^O 
 
 00 On CM coo 
 
 '-' CA CM VO Tt- 
 
 ^%^^% 
 
 
 
 
 CM 
 
 to VO -^ rj- CM 
 
 OCOCO ^ VO 
 
 '-'to CO CM CO 
 
 r^totN.t^ On 
 
 
 
 
 lOVO 
 
 ^toOtoOO 
 
 Tl- C?N VO CTn '-' 
 
 COtI-COOnO 
 
 t^ CM O CO ON 
 
 "^CM VO CMO 
 
 
 
 
 CMO 
 
 00 ONOtoCM 
 
 Ovcoiorf CO 
 
 00 cooovo a^ 
 
 c^j r^ ^ '-I to 
 
 On NOVO CM ON 
 
 to t^ to CM CO 
 
 
 
 ^ 
 
 to VOlO 
 
 OjO-HTtrO 
 
 ONOO O VO o 
 
 CV) On CM to O 
 
 COVOTtr-.^ 
 
 
 
 CMt^to 
 
 voot^r^'-i 
 
 CO O to to On 
 
 00<MCMVOVO 
 
 CO to to »— 1 lO 
 
 vOto crj o VO 
 
 
 
 to 
 
 to O t.^ »— 1 
 
 r^Tj- or^to 
 
 CM— 'On 00 r^ 
 
 t^OOOvOCM 
 
 to CO CM t^ CM 
 
 OOto COCM v-H 
 
 
 
 
 . p '"1 ^ ^. 
 
 CM CO ^ -^ to 
 
 vqt^f>.oq ch 
 
 p >-; CM ''^ to 
 CM CM CM CM CM 
 
 vq t^_ On O CM 
 CM CM CM CO CO 
 
 CO to l^ On r-i 
 
 CO CO CO CO Tf 
 
 
 
 — 
 
 :2S 
 
 rj- CM ro -H Tj- 
 
 CMtocoOCM 
 
 TttO '-<t^ r-H 
 
 (N vo^toco 
 
 vO-HVOONOv 
 
 
 H 
 
 ^Q 
 
 Ov— loovo-^ 
 
 Tj-OTfr-iav 
 
 ^^cor>.co 
 
 Or-HOCOOO 
 
 Tl- O >-0 0\ Tj- 
 
 
 e^ 
 
 lovooo 
 
 '-H O '-I Oto 
 
 OVCO ^ vO'sf 
 
 CMOVOCOO 
 
 Tf T-H cvi VO CO 
 
 Tl- On CN CJN VO 
 
 
 C/3 
 
 :i^ 
 
 CMVO-^ 
 
 OOVOVOOOV 
 
 voto CO On -^ 
 
 00 1^ i-^ r^ VO 
 
 -HTt-tovo— ' 
 
 CO t^ O On c-j 
 
 
 M 
 
 O '-•to 
 
 '-HCMOO— lO 
 VO CM OCM VO 
 
 a\oooo^a\ 
 
 CM CO CO xf 00 
 
 r^CM VO 1— ' o 
 
 rr VO o vo o 
 to O CM 0\ -^ 
 
 
 
 •^ 
 
 tOCM r-HCM 
 
 CM CM to CM -H 
 
 to CM CO 00 I^ 
 
 '— ' O COCM VO 
 
 
 
 ■^ON-rfOv 
 
 Tj- O VOCM 00 
 
 to CM OM^ to 
 
 COCM "-I O O 
 
 T-H CM cotor^ 
 
 O -^ OC- Cv) 00 
 
 
 
 , p O r-H ^^ 
 
 CM CO CO '^ -^ 
 
 to vq VO t^ 00 
 
 OnO '— ' CM CO 
 .-J CM CM CM CM 
 
 ■^ i--> VO l^ oo 
 CM04CM(MCM 
 
 P .-H C^jTf to; 
 COCOCOCOCOi 
 
 C^ 
 
 1— 1 
 
 Q 
 
 — 
 
 VO 
 
 OCM00iO»-H 
 
 OOVOCM^to 
 
 1— 'too CM 00 
 
 rJ-i>.ONThvo 
 
 COCO OOCMtOi 
 
 
 to 
 
 O^Ot^OOO 
 
 OlOCMtOTf 
 
 to CM to lO T— 1 
 
 r-' Ol^tO r-H 
 
 CO r^ to CO Tj-i 
 
 05 
 
 D 
 
 
 TfOO 
 
 c^cn^ONr-H 
 
 Tj-Tj-CM CO VO 
 
 CO '-H O VO CJN 
 
 CI CO 00 to '^ 
 
 VO 0> OO CO .-1 
 
 
 voto 
 
 to r-H CO VO '-H 
 
 Tj- to CO t^ ^>. 
 
 ^COO— 'Tt- 
 
 C\i VO ^ ^ O 
 
 CO VO VO O to^ 
 
 O 
 
 •^o 
 
 VOOOCX) 
 
 VO coc?\toco 
 
 CM ^ OO VO 
 
 ONONONCOOO 
 
 r-l t^ ONt^ CO 
 
 00 "^ cor^ VO' 
 
 < 
 
 Oh 
 
 e<. 
 
 r=;-^ov 
 
 VO to to 00 CO 
 
 OON T-l to r-l 
 
 O CM i-^ to O 
 
 "-I 00 ON -^ CO 
 
 to CM c>-:i oo 00' 
 
 1 
 
 o 
 U 
 
 H 
 
 r^ 
 
 ■^OOCVJ VO 
 
 ^VO-HVOCM 
 
 OOCOOVOCO 
 
 OI^ '^^CM O 
 
 CJn t^ VO VO VO 
 
 vOt^OOON'-Hi 
 
 
 _pp'-:-; 
 
 CM CM CO CO rj; 
 
 Tj- to vq vq tN. 
 
 oooqovp--; 
 
 y-i 1—4 1— H CM CM 
 
 "-^ CM CO rf to 
 CM i CM CM CM 
 
 vqt^ CO On —It 
 Cvi CM CM CM col 
 
 1 
 
 1 — 1 
 
 
 
 
 
 
 s 
 
 
 §88 
 
 r-i COVO "^to 
 
 VOCMVOVOCM 
 
 coT^loocM 
 
 vOt^OOOO On 
 
 1 
 OOVO t-i vOOOi 
 
 
 CO COCMO CO 
 
 t^t^ vOOto 
 
 OOOtOCM CO 
 
 OO^lOTt ^ 
 
 OO^r-HTJ-OO 
 
 CJN to »— 1 On c:^ 
 
 « 
 
 
 
 tot^ CO 
 
 VOtOONO\t^ 
 
 00 ON CO vo^ 
 
 00 VO lO On ^ 
 
 Tfto vot^r^' 
 
 <: 
 
 ^ 
 
 CVlr-lOg 
 
 OOtot^ O Ov 
 
 On VO VO to On 
 
 '=:t- 00 1-^ CO O 
 
 CO CO ^ t-i CM 
 
 H 
 
 CM t^to 
 
 VO CM CM 00 00 
 
 to On OC^ VO 
 
 COON VOx^lO 
 
 r^-<^to t— 1 CO 
 
 CM Ovto— 1 00 
 
 fc< 
 
 ^ 
 
 tO'-t oor^ 
 
 l-.0v(MV0C^ 
 
 O CA r-H roOO 
 
 to CO '^ l-^ CM 
 
 C3NON r-i VO CO 
 
 coto— 1 O'-': 
 
 
 cot^o-^ 
 
 00 CM l^ r-i MO 
 
 T-H to T-H \0 >-< 
 
 t^ CO ON to CM 
 
 ootocoooo 
 
 VO"^ COCM 1-' 
 
 
 o 
 
 CO 
 
 _ P p '-H r-J 
 
 T-< CM CM CO CO 
 
 TtTt toto vq 
 
 vq ^s.^s. CO On 
 
 Ovp r-iCM CM 
 '-'CM CM CM CM 
 
 co"^tovqt^ 
 
 CM CM CM cvi CMi 
 
 
 o 
 
 < 
 
 
 
 
 
 
 
 
 T— 1 
 
 wor^oooo 
 
 00 1^ On '-^ CM 
 
 CM -^ COVO to 
 
 COr^ r-l ^ ^ 
 
 COI^r-^OOr- 
 
 
 
 00 
 
 OCOOOO— 1 
 TfCM coOco 
 
 cooocot^r^ 
 
 n-Tfvooo 
 
 CM to T^ to '— ' 
 
 O CNl O VO to 
 
 
 
 r^ 00 
 
 VO coo CO On 
 
 r^ VO t^ CO VO 
 
 '-' ^ CO VO -^ 
 
 t^ 1— ' ONl^tO 
 
 
 
 rgo 
 
 t^tot^ol^t^ 
 
 ^ CO VO cooo 
 
 vOO'^t coo 
 
 -hOOCOON 
 
 r^ONOOCMvo 
 
 
 
 
 CM ooot^r^ 
 
 On CM l^ to to 
 
 CDNt^OO-^tO 
 
 '-^ CV) >-HLOt^ 
 
 r^tocM 0\to 
 
 
 ^ 
 
 OCMtO 
 
 0^■^C^v0T^ 
 
 co^toOOC^^ 
 
 t^ -Tf CM (M CO 
 
 VO O VO COCM 
 
 COVO '— ir>. VO 
 
 
 
 1— i > I T-H T-5 T-H 
 
 toOvCM VOO 
 
 Tl-00 CM MD '-< 
 
 tOOtOOto 
 
 OVO^t^co 
 
 On to CVJ 00 to 
 
 
 
 CO 
 
 "I ""i ^] ^. *^ 
 
 CO r<"\ Tf -^ to 
 
 to \q vq r>>. t-x 
 
 COCOOnCTnO 
 
 r-i r-i r-i ^ CM 
 
 O '-^ CVJ CM CO 
 CM eg CM Cvj C^' 
 
 
 
 — 
 
 lOtO VO 
 
 r^voC^toCM 
 
 CO -^00 CO CO 
 
 vo-^tocoO 
 
 CO^-t -^OOO 
 
 
 
 CM to to CM VO 
 
 
 
 
 CM to CM 
 
 CO corf too 
 
 OTft^co—i 
 
 ON-^ONt^ C3N 
 
 rfCMOr>.^ 
 
 ooi^t^ooo 
 
 
 
 
 VOONr-l 
 
 COOOOVO VO 
 
 T-H r-H CO to -^ 
 
 OOC?NtOON(>l 
 
 CO O CO CNJ VO 
 
 O to o VO VO 
 
 
 
 ^ 
 
 to 00 CM 
 
 t^ VOCM 00-^ 
 
 to CM 00 VO ON 
 
 0\0to VOCO 
 
 CM --^ too CM 
 
 VO Tj- (M CM O 
 
 
 
 tot^l^vo 
 
 (Nt^'-Hcoto 
 
 vor^r^ CO ON 
 
 ^to On to CO 
 
 x^^^ coco VO 
 
 CO »0 CM ■* CM 
 
 
 
 ^ 
 
 t^ to "^ "^ 
 
 to VO OvCM VO 
 
 T-< t^ Tj- CM '-1 
 
 CM CO to ON -sl- 
 
 Ol^ VO vot^ 
 
 O -^ Ot^ VO 
 
 
 
 CM to 00 '— < 
 
 rj-t^OTj-r^ 
 
 '-I ':^oo CM VO 
 
 O -^OOCM t^ 
 
 CM VO 1— 1 VO'— ' 
 
 I^ CVI OO CO ON 
 
 
 
 0^ 
 
 _ p p p T-J 
 
 ^ r-H CM CVj CM 
 
 CO CO CO ''^f'^ 
 
 to to to vqvq 
 
 i>.t^oqoooN 
 
 C?\00-^^ 
 1-JCM CMCMCM 
 
 s- 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 s-^ 
 
 
 en 
 
 
 
 
 
 
 
 00 
 CO 
 
 
 O 
 
 0'-<Mcorf 
 
 iOVOt^00O\ 
 
 Oi-HCMCOTl- 
 
 iOVOt>^00ON 
 T-i T-i y* y—t y—t 
 
 CM CM CM CM CM 
 
 iovor^ooo\ 
 
 CMCMCMCNJCM 
 
 009 
 
 
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COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 339 
 
 OnOOOOOCNJ 
 roooroO'-H 
 
 t^O'-' rOrl- 
 OOirjoOirjo 
 
 vO t^ vo Tf CO 
 OO-^cOiOO 
 
 VO r-< \0 ^t^ 
 
 KododcKoN 
 
 t^ '-H r^ Tf ,-H 
 
 ^ VO COIOOO 
 CO OiOvoOO 
 
 PO 00 f5 <0 fi 
 
 00 TtT>»t^O 
 
 .-HOO'-it^O 
 vO "^ On OOio 
 
 'OOn VO ONt^ 
 
 t^LOTf CO CO 
 
 CO Tt iri vd r>I 
 
 I^OM'JIOOO 
 
 CVI U-) 00 VO --H 
 
 '-' COVOOSON 
 
 cvjiooortr^ 
 
 Tj- vo ON'-i O 
 OOTfCvirtON 
 '-HO^COTJ--- 
 
 lO 
 
 O\C0O\^^ 
 
 O^OrfT-H 
 
 On OnCmo 
 VOvOOOTf 
 lOONt^ vo 
 
 Onio ^'On 
 t^O-^OO 
 
 00 .-H 
 
 On lo 
 
 Tf O 
 lO CO 
 
 CO On 
 
 00ONt>.rMv, 
 cotJ-tJ-loOn 
 C^On^OOI^ 
 
 •«i- CO Tf 00 T^ 
 
 OnOON'-'CO 
 »-' 00 ■«:♦• CO CO 
 
 ca CO \o Q in 
 
 COlOt^ OCvJ 
 
 r^'^TfONio 
 
 CO '-H 0\Cvl ^ 
 lOVO^t^ '-< 
 ,-H ^ OI~^iO 
 
 SOOrf rrr^ 
 
 !-• ONOOOO o 
 
 lo r^. p <^ t^ 
 
 lotovovovd 
 
 »-<u-)VOcoOO 
 t^ ^10 0N<N 
 
 OOOOt^ vo o 
 oocooONOm 
 Omo vo t-< 
 
 '-H ^ ONt^ 
 
 CO On vOTfio 
 O f^t^ '— 'lO 
 
 ^s! »< t>! 00 00 
 
 8^: 
 
 On 00 On lO CO 
 t^.- OVO I-" 
 t^OO '-< Onco 
 
 8lOt^ NO CO 
 CVJOn<V) CO 
 to Tf in »-i '-H 
 OOCOOOCVJ 
 On "vj" ONrr On 
 OOOnOnOO 
 
 On 0^1 On vo Tf 
 r^ ONOOi-oio 
 
 On OioOm 
 ONCOOOQCq 
 
 t^lJ^ONONNO 
 
 vo<^r^co(N 
 Tf vovOOO-^ 
 
 OnO-^ 
 
 CONOlO 
 
 OOiOC^) 
 
 vom to 
 
 OTf 00 
 
 lOVO t^ 
 
 NO t^ lO 
 
 COVO CM 
 
 o-^ '-^ 
 
 coco o 
 
 r^ o lo 
 
 CO to Tf 00 "<*• 
 
 OOW-^O'-H 
 i-HtoOOcONO 
 
 coooonoco 
 in CO On rf NO 
 Tt ^ 00t>.NO 
 t^ONOCN-* 
 
 ^vOON'-hOO 
 OO-^TfCviO 
 t>*00QON On 
 rft^vO'-H On 
 CO CO 00 (M 00 
 
 t^t^NONOtO 
 
 NO t^ On eg NO 
 
 vq 00 p CO to 
 
 Tj-TfOOOOO 
 tr. On -^ '— ' On 
 "^ QirjOO CN 
 NC O'—coCM 
 
 CO »-• NO Tj- ,-1 
 
 NO00»-it>vVO 
 
 »-t t^lO CO CO 
 
 oopcovqoN 
 io\o\dvd\d 
 
 CO 1-1 On r>. tN. 
 
 rt-V0'^i/)O 
 
 OOOnOOiO t-H 
 
 TT i-HNOml^ 
 CVJ TfOJ Tf NO 
 
 OP Tfio 1— I CO 
 eg in On CM vo 
 t^KKodod 
 
 t^tvcOONOO 
 CM '—I On com 
 NOOCt^CMiO 
 
 cooooco 
 
 NO fO Tt t-^ »-H 
 
 CM vot^O rt 
 CO lO CM 00 00 
 
 On «-<■ Tt t< 1-; 
 ,-H^^CM 
 
 OncocoOOO CO 
 
 CM Tj-i—i COVO P 
 
 NONOtOiO y-i 00 
 
 0> On too On t-i 
 
 ONp"^ '-<t^ to 
 
 Nc o 00 r^ O 00 
 
 ■^coiocor^ 00 
 
 1— I 00 '-'lOTt m 
 
 K CO CM CM lO -h' 
 
 CMCOTJ-IOVO 00 
 
 *-i^ioO"^ 
 
 tOTf t^ 1— I CO 
 
 t^coOO t-tNO 
 ONComoO'-t 
 CO '-• OCOCO 
 CO CO 00 00 'it- 
 
 Tfr^OTf On 
 CM CO in NO t^ 
 
 fO fO CO CO CO 
 
 Oniono^oOn 
 CTniOOO"^ On 
 00 CM On CO to 
 00 CO 00 —I NO 
 OOnO ^co 
 NO CO 00 00 NO 
 -^i-OvOco^ 
 On 1-1 CM Tf NO 
 CO ■ ■ * ■ 
 
 COiO»-Ht^00 
 
 nOtJ-OnCMO 
 O »— I coioiT) 
 
 CM NO 00 ON'-" 
 
 OOt^TflO 
 
 •-H CO (MONO 
 
 Tt"'!-"^'^ Tt-'^xninm 
 
 OO^CM-^lv. 
 
 NO t^ NO CM CO 
 lOCMiOOO 0\ 
 t^CM '-'CMTf 
 
 1-. 00 00"-) CO 
 
 "-•Tft^O CO 
 Tft^ .— t^CO 
 
 oqpcoirjoq 
 lo NO vdvd NO 
 
 ID CM '-'CM to 
 
 CO ON Tl- CM CO 
 
 CO NO r^ to 00 
 
 00 NO C^^ CO '-I 
 
 NO CO NO t^ NO 
 
 NO VD On CO '-' 
 
 OTf 1-hOnI-x 
 
 ,-j NO lo r-x m 
 
 K CO CD CM to 
 
 vo r^ Tj- Tt Tj- 00 
 
 vOOOncoCJn t-i 
 
 Tf c?N Tj- com 00 
 
 to On O COOO -^ 
 
 CM t^ NO CO CO Oi 
 
 ID On CO On '-I rf 
 
 00 CO 00 Tl- ^ O 
 t-iCMCMCO"^ m 
 
 OooONinco 
 
 txTftOCOCO 
 
 cO'-'tNiCMO 
 
 CJncoO-^O 
 t^Ot^ChOO 
 
 NOlONO r-t O 
 
 OpO-H(M 
 OOOnO— "CM 
 CM CM CO CO CO 
 
 iOi-<coCM'-< 
 
 Tf.-<TfCOr^ 
 
 o 
 
 ON' 
 
 coo 
 
 CO to t^ On CM 
 CO -^ to NO 00 
 CO CO CO CO CO 
 
 CM^OnCMO 
 t>*OOONONO 
 C7\ CO t^ Cvi »— I 
 to CO too ** 
 CM 00 CV) t^ CO 
 ONt^ '-' Onco 
 to On -^00 Tl- 
 OiOCM com 
 
 COTfTtrfTh 
 
 w^O'^OOOn 
 m T-H o OMO 
 00— 'TfODTj- 
 mrf OOOCVO 
 coONCMmp 
 
 CV) NO t^ CO NO 
 
 O vocO'-i On 
 tN. oqpcMco 
 rfTtiotom 
 
 no-^ooono 
 
 CO'-'ChVOCM 
 
 "^r^^CDOm 
 
 CM "^ O O eg 
 
 ONt-^ orv.00 
 
 TfCOOOVOCM 
 
 00 fOl^mr-H 
 
 mvq 00 f*^'-^ 
 m VO In! On T-H 
 
 00Tj-T-.m 
 comco C3N 
 orv.oom 
 
 ID CO to t^ 
 tOtv^OO '-I 
 
 oomtN.cM 
 
 ONt^ '-"-' 
 
 ^NONOi-; 
 coin 00 CM 
 
 NO 00 
 
 m 0\ 
 
 00 " 
 CM 
 CO 
 
 CM r-i 
 
 NO ON 
 
 CM r^ 
 
 NO ^ 
 
 CM CO 
 
 5 
 
 t^ to NO Tf O 
 
 ""^ CO t^ CM CO 
 CMOCMtoto 
 
 NO 00 00 COO 
 CM O O CO On 
 r^omCM T-H 
 
 CM Ot^ to CO 
 Tj- tf J iq NO t>. 
 CM CM CM CM CM 
 
 to CO 00 00 00 
 tJ-cono-^On 
 CM 00 NO CO NO 
 NO t^ CM CO CM 
 OOCMCMt^O 
 
 cooom-^t^ 
 
 '-'On octavo 
 OOOOOnO^ 
 CM CM CM CO CO 
 
 ocoONrxrx 
 
 t^ ON 00 t^ CM 
 
 t^oomvocM 
 
 CO CTn CTn >— I to 
 OOONOmTj- 
 CM OnO'^'-' 
 NOm NO NO t^ 
 
 CM CO Tt to NO 
 
 CO CO CO CO CO 
 
 TtCMCOOOTl- 
 
 oot^Ooo-«^ 
 
 lo coto r-c On 
 On ""^ Omo .-< 
 m O 00 CM CM 
 T-imT-iCMvO 
 00 On*-* coto 
 t^OOO'-'CM 
 
 COCO-^TtTf 
 
 CMOnO^O'-i 
 
 — m,-ir^ On 
 
 00 CO CM —I 
 
 S! 
 
 CO CM '-«ONt^ 
 COOOOCM'-i 
 
 copoqoqoN 
 
 Tt^trjvoNOtN! 
 
 CA a) tv. Tj- ,-1 NO 
 
 ooomooo 00 
 
 t^rf cootv. y~i 
 
 »-«NOCOCOiO CM 
 
 On O CM "^ vd On 
 
 coooootxvo 
 
 bx CM CO On CM 
 .-'00 ^t^NO 
 Q»OCM coto 
 nOOt^-OnCM 
 NO 00 CM t^ to 
 
 m'-'oo'^^ 
 CMcoco'«^m 
 
 CM CM CM CM CM 
 
 '-<CMOO»0 
 
 OOtot^ '-'On 
 tor^ coooio 
 
 CM Ov CM to to 
 
 TfTf tOtONO 
 
 Tf to 00 cop 
 
 OOmCM OOO 
 lONOt^OOOO 
 CNJCMCMCMCM 
 
 a: 
 
 CM NO NO t^ 
 lO''^ cot}- 
 
 cooioooo 
 
 t^ t^ O "^ CO 
 
 00 CM O* 00 --I 
 
 CM CO CO CO CO 
 
 oovocooom 
 
 t^ O Q\00 CO 
 xl-NOO C?N"") 
 
 NO CO r-^ 00'-' 
 
 OOOOOCgrj- 
 ONCOOOt^OO 
 
 oooot^t^t^ 
 
 CO "^ to NO t^ 
 CO CO CO CO CO 
 
 l^TfVOTfNO 
 t-^NOCOt^t^ 
 
 »-< On.-! ONNO 
 CV) .-< to T- ' to 
 COCOCMOCM 
 CMNO CM CM CTn 
 CO-^CTNCOtv. 
 OOrfpcONO 
 
 coTf mtoNC) 
 
 CMCMOOCMTf Th 
 
 1^ O to CM 00 
 
 Tj- •^ CM CO i-O CM 
 
 CO 
 
 t^mr^ 00 T^ CM 
 
 to com .—I to Tf 
 
 onqco'-'P cm 
 
 Tf NO CO C3N vO t^ 
 
 vq tv. p Tt; ,-j p 
 
 In! odo '-^ CO m 
 
 O'-'CMcoTf lOVO^x00O^ O^CMcorf u-JNOt^OOON OmoioO toOioOm O 
 
 eOCOCOCOCO COCOCOCOCO Tt •* Tj-Tf rf Tj-TfTj-TfTf mmVOVOt^ tNOOOOONON O 
 
340 
 
 TABLES 
 
 
 vo 00 u->0\ 
 vo t— I OOiO 
 
 On 0^ On C5\ 
 "OCJOO 
 
 0\t^"^txvO 
 eg 00 CVl u-> CO 
 
 rl-^Ovo"O00 
 lO Oi O -^CNl 
 OO CM CMt^t^ 
 
 COCN ^OO 
 OOMDrfCgO 
 00 00 00 00 00 
 
 QOOOiOOO 
 
 00 "^lo or^ 
 
 ONTfioCMCM 
 
 ^ CM CO to r>H 
 
 OOvOTf CNO 
 
 ooooo ooooo 
 
 "^ 0\0 0\l~^ 
 u-5 rf to lo r^ 
 
 VOCNJ 0\^ CNJ 
 Tf vo ^ r-c lO 
 
 ocor^x ^ to 
 
 On t^ to Tf CM 
 
 vo VOVO vo "O 
 
 oc5oc50 
 
 CVJ rOOO vo CO 
 Oto O VOCM 
 ■—I On 00 vo to 
 vo to to to to 
 
 ooooo 
 
 OnCvI CO 00 to 
 to !>. r^ t>^ cvj 
 
 O "^ 0\t^ r-l 
 ONCOONt^VO 
 
 CO eg CO 00 vo 
 ONVOCOOOO 
 cocg ^ OOO 
 to to to to Tf 
 
 oooc5o 
 
 < 
 
 CM 
 
 ^ 
 ^ 
 
 T-HOOOO 
 
 to CVJ t^ VOtO »-H 
 
 CO cocg Tj-covO 
 
 CO CM T}- OnOO '-I 
 
 ■^ ^ CM vo coog 
 
 00 t^O t^ ONto 
 
 rj- rj-ioto vo 00 
 
 y-l ONt^tOCO '-H 
 
 ON 0000000000 
 
 oc5ooo 
 
 c ) On 00 to In. 
 
 r-l ONTfOCO 
 
 O'^I^On'-h 
 ,-( On vo '-I Ti- 
 to 00 vo 00 CO 
 8 CM to 00 CM 
 OOVOTfCO 
 oo t>s r>. tN. t^ 
 
 OOOCMCO-* 
 (NOO '-•VOOO 
 vOtoCMl^rt- 
 CM vOtot^ CO 
 CMtJ-OOnCM 
 
 VO O"^ C7\to 
 '-1 OOO voto 
 t^t^ vo vo vo 
 
 r^oot^Tj-co 
 
 Tj- cotoCM vo 
 votOTj-i^ vo 
 r-H ^Cgco'-^- 
 OOtN. ONTj-CM 
 
 OVOCMONVO 
 
 TfCNJ r-lONOO 
 
 vo vo VO to to 
 
 OOOOO OOOOO OOOOO 
 
 CTM^t^OOco 
 C0 0\ '-H 00'-< 
 vo ON'-' CO CM 
 "^(N ON CM CM 
 
 cor^ CO CO to 
 
 cOOCOVOTf 
 t^ vOt}- COCM 
 to lO to to to 
 
 o o d o d 
 
 vo 00 CO CO 
 »-Hr^ coTj- 
 CM 00 CM to 
 
 owocgrj- 
 co^ cooo 
 
 O r-H CM CO 
 
 oovoT^r^^ 
 
 On On On On 
 
 t-hOO 
 00 CO 
 O— ' 
 coi^ 
 
 t^ON 
 tOl^ 
 
 QOO 
 On 00 
 
 oor^t^ 
 
 .-H COCM 
 OOtO 
 vo On to 
 tori-r^ 
 
 Oco vo 
 
 t^tO CO 
 
 CO 00 00 
 
 Orj- 
 
 coo 
 coco 
 
 Tfvo 
 COCM 
 OTf 
 CMO 
 
 00 00 
 
 00 CO CM 
 
 t-H too 
 
 CO CM to 
 
 ONCor^ 
 
 Tj-OCO 
 oocot^ 
 oor^to 
 
 odd 
 
 CO'-H voi^vO 
 t^ 00 to CO r^ 
 
 Tf to eg On O 
 T-H T:t- vo to CO 
 Orj-r-( ^t:1- 
 cooo -^ O vo 
 
 Ttev^ t-H ooo 
 t^t^t^t^ vo 
 
 d'd>c:>d>d> 
 
 CO CM-* CM ON 
 
 coOOOChTj- 
 
 T-H to 0\ to 1— t 
 
 t^vt^ coto CM 
 
 ONt^oo "-ir^ 
 
 CM ON vo Tf r-H 
 
 lN.tOTj-C0CM 
 
 vo vo vo vo vo 
 
 tN.00TtlO.-< 
 
 COCM Otoco 
 
 OONeg Tt e^ 
 
 COt^ VOt^»-< 
 tOtO 00 CO »-H 
 ONf^tO Tj- CO 
 
 O ONOOt^vO 
 vo to to to to 
 
 oorN.00 ri 
 On t^CM'O 
 
 8 t^ to 00 
 On CO to 
 
 ooooe^iON 
 
 CM to ON CM 
 OOVOtJ-co 
 On ON On On 
 
 rf-rfOOt^tO 
 lOtO t^tO CO 
 
 CM CM CO t-H T-H 
 
 On 
 
 vo r-( to O to 
 
 '-I ooor^to 
 
 ON ON OO 00 00 
 
 t-tOOOO OOOOO 
 
 OOn 
 VOCO 
 00 CO 
 CM vo 
 t^CM 
 Ovo 
 
 Tt-eg 
 
 CO 00 
 do 
 
 ooooo 
 
 00 CM ON 
 
 r^ '-t Ti- 
 to ON vo 
 
 ooco 
 
 CM COTf 
 »-H ONCO 
 
 oot^t^ 
 
 ONi-llOO'-t 
 tOCOOONO 
 Tf VOVO ON Tf 
 
 t^'-HOOt^ON 
 
 oovotor^ ^ 
 orN.Tf »-H On 
 
 t^tO Tf CO •— I 
 
 OOOvOOt^Q 
 
 toco eg r-io 
 
 Tf t^OOOOO 
 
 eg vocMt^ CO 
 
 00 vOt^<3^Tt• 
 vOT^CMOON 
 O On 00 t^ to 
 t^ vo vo vovo 
 
 OOO ooooo OOOOO 
 
 VOCTntI-OOvO 
 
 ONTj-ONeg 
 oo\ONeg'_ 
 00 vo >o to Tj- 
 
 Tf COCM '-lO 
 
 vo vo vo vo vo 
 
 o 
 
 w 
 
 H 
 
 Pi 
 o 
 
 H 
 
 w 
 
 CO 
 
 w 
 
 i>NtooNco coononcm'* cocoegcMoo o^j-vocm^ 
 
 vOt^ONCM cOr-Ht^^CM CMCM^tOeg toOCMto-^ 
 
 '-•'-'VOrJ- OCMvOt-iCvj t^cot^t^Ov ^^to,— it^ 
 
 V..O CMvo.-<oo voTfcv)r-HON vococoeg-Ji- tocoooi-io 
 
 e^ CMVOCO'-H CVl>OOtN.to vOOnCOOOO COOCOCTnVO 
 
 Vs tOOVOCM OOTt-1-it^^ ^oOVO'^r-i ONOOVOrtCO 
 
 ►X COt^tOTj- CM^-HOOOt^ vOtJ-coCM'-h CTNOOl^vOto 
 
 ^CTnOnOnON CJnOnOnCOOO 00 OO 00 CO 00 t^t^tv.t>.t^ 
 
 idic^dd dcSdcici cDcid>ci<d> dddcScS ddddcD 
 
 C\1 to CO 00 CM 
 
 r^C3NVOOC7\ 
 
 ot^t^t^<^ 
 
 I^CTnOO co-^ 
 Tf^vO Oto 
 
 COCM Tj-iOl^ 
 
 CO to r-^ CM 00 
 
 to O to On 00 
 OCM OOONtO 
 CMO OnO^O 
 ON On 00 On q\ 
 OOt^ VOtO"^ 
 vo vo vo vo vo 
 
 
 CM vo CO 00 
 CO oco CM 
 ""t — oo^ 
 
 voTJ-T^to 
 
 t^tO CO r-H 
 
 00 f^ vo to 
 On Ot On CTn 
 
 VOOO CO to On 
 O CO CDNTf vo 
 r >. Tt- to 00 o 
 l^ I^ »-i On CM 
 
 r>. ,— ( r^ CO CM 
 
 onoo votoTt- 
 co eg '-I o C7N 
 
 On On On On 00 
 
 covoo 
 ONTl-vo 
 
 ot>>.oo 
 coi^o 
 
 1— I CM to 
 
 COCM -H 
 
 oot^vo 
 
 00 00 CO 
 
 ^OOOO ooooo OOO 
 
 CJnON 
 
 VOO 
 CM 00 
 t^ vo 
 00 CO 
 OO 
 to Tt- 
 
 00 00 
 cSd> 
 
 00 to 
 
 t-ico 
 covo 
 
 ONTJ- 
 
 ON ON 
 CM'-t 
 
 00 00 
 
 CMTtvo 
 
 Ovovo 
 
 voooo 
 
 CM CO to 
 
 vo vot^ 
 On ON C3n 
 OC7N00 
 
 oot^t^ 
 
 to »— I vo cor^ 
 
 to 00 On too 
 
 oooor^Tti^ 
 Ot^ voi:^ On 
 
 BcOOOTf '-' 
 oo^eg 
 
 00 l^ vo to -^ 
 
 Tj-TfvocooO 
 ^ CO CM to tx 
 ■rf-^ vo OOON 
 COCO Tj- .-iO\ 
 
 ooNoegrf 
 
 cocotovOtN. 
 
 coeg r-ioqj 
 
 ooooo ooooo ooooo 
 
 ^ 
 
 ^oooo 
 
 On Tt to eg CM 
 
 vocMoe^ioo 
 to to 00 CO On 
 V0r^r-.00co 
 
 ■^ Ot^Tf CO 
 
 '-•CM CM CO Tj- 
 tOTf CO CM <— I 
 <?N On On CA On 
 
 c? <z> <z> d d> 
 
 tOCM COOt^ 
 
 ONt^CM vo On 
 
 VOCO On CM eg 
 
 OOCMr^vo vo 
 CM COTI- vo C?N 
 
 tOVOt>* 00 C?N 
 
 o c^oot^ vo 
 cjnoooooooo 
 
 t^voCTN'-^CM 
 
 rj-eg Ttcoc^N 
 On '— ir^r^o* 
 
 Tj-CMr^ r-H CO 
 
 cococoofN. 
 '-^eg rfvor^ 
 votoTj- roeg 
 
 00 00 CO 00 00 
 
 t^r^i— I cdnco 
 Tt- ,-( CM r^ T-H 
 
 T)-OVO ^ vo 
 Tl- CO CTn -^ vo 
 to ""^ CO "^ to 
 
 On '— < CO to t~>. 
 
 '-I -hOOnOO 
 
 oocooot^t^ 
 
 Tj-voCMt^tO 
 
 Tf Ol C?N to r-l 
 
 00 t^ CO to CM 
 
 ooooo ooooo ooooo 
 
 O'-hCMcO'^ tovot^OOON O^CMCOTl- iovor>.00ON Oi-iCgcOTh iovOt^OOO\ 
 ,-< ,-H ,-H .-H ,-t T-( T-H ^ rH r-( CMCMCMCMCM CMCMCMCMC^ 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 341 
 
 C^l Tl- O CNJ u-> 
 
 ■>!4- T-HI^ O O 
 
 vo 10 CO eg .—I 
 
 t^ vo >r> -rj- CO 
 '^ Tt Tf Tt T:t- 
 
 OCJOOO 
 
 t^ OWO 00 -^ 
 fOOO<Nt^ 
 
 vo a\oooot>s 
 
 O vO -^GO CO 
 CO -tT CO CO o 
 Tf COTJ-OO-^ 
 CNJ CO Tj- lO l^ 
 t^ ^O l-O Tt CO 
 
 CO CO CO CO CO 
 
 ON'-' 
 CMfVJ 
 coco 
 
 TfVONO 
 
 O.'-Ht^ 
 Cq T-HIO 
 
 covOCNJ 
 COLO 00 
 
 ^oo\ 
 
 CO CO CN) 
 
 r-HoqoM^oo 
 csj 10 U-) u-j m 
 
 CM o com CO 
 T^m coooio 
 0\ '-' CMOOm 
 
 OMn CM o i^ 
 
 CM CM CM CM —' 
 
 00000 00000 00000 00000 
 
 0\r^ coonco t^ 
 
 Tf »o MD t^ r^ CO 
 
 T-i Tf rf irj O t^ 
 
 CO o OMor^x Tj- 
 
 OM^ Lo CO r>* vo 
 
 VOOO CM <X)u-) T^ 
 
 u-3 COCM O ON CO 
 
 '-"-i^^O o 
 
 odoCJCD CD 
 
 OO^COOO'-H 
 O O C0l0'!i- 
 CM CMiO ^ 
 C/J OmJ-j 10 Ch 
 ON 'O OCX) CM 
 CM ^OCTnOn 
 '-' O ON 1^ o 
 
 U^LO';^r;^ Tt 
 
 CDOCDCDcrJ 
 
 OCM 
 VOO 
 
 ONO 
 CJnGO 
 
 coco 
 
 OCD 
 
 00OC50 
 Ot^CM 
 CM CM 10 
 
 ON CO CO 
 On coco 
 CO ChON 
 CO CM ^ 
 
 000 
 
 VOTfNOlOCO 
 
 t^ m >— I CM >o 
 
 10 On CM ON NO 
 •<^ o r^ CM 1^ 
 vo NO t^ ^ ^o 
 O '-'CMTj-io 
 -H OONOOt^ 
 tT Tfcoco CO 
 
 OCJCJOO 
 
 •— • O On 
 
 0000 
 
 C?NLO00 
 OCM — ' 
 
 Tf CO"^ 
 NO 10 10 
 
 COCO CO 
 
 <od>d> 
 
 00 CM 
 
 10 CM 
 
 C»CM 
 
 CO NO 
 
 '^fO 
 coco 
 
 00 00 NO NO -,N 
 
 O CM 10 CVI O 
 NO iri 00 CM CO 
 CM r-( Tt- Tt 10 
 
 t^ T-"-H Tf NO 
 
 CO Tf CO to O 
 cvi On NO CO '-' 
 CO CM CM CM CM 
 
 1-1 coOOt^ On tJ- 
 
 On On CM On ^ 00 
 
 CO CMO C?\J>» O 
 
 t^CMt^OOtN. NO 
 
 TfNOOO ot^ o 
 
 00 00 O "^ O 00 
 
 CONOmcoCM O 
 
 00 00000 00000 O 
 
 ONr>>, ocoi^ 
 00 CA cot^ »-• 
 
 oiocooooo 
 
 1^ Tf CO CM CM 
 OCM NO CM O 
 CM ^ 000 
 VO '^ CO CM '-< 
 
 10 10 10 LO 10 
 
 '-•VO CO ON CM 
 
 NO — •CA'^CM 
 
 r^ coot^ 00 
 
 CMCM '-lOO-^ 
 
 o c^^ o '-' ON 
 
 O CAOO r^ NO 
 vO^Tj-rj-Tl- 
 
 oooo-o 00000 
 
 CM "-I CO vo^i- 
 rl- (N) ^ 1^ r^ 
 
 oo-^ooo 
 
 ON'-^ OMDO 
 
 000 cor^T^ 
 
 CM "^ 10 NO 00 
 vOTt COCM '-I 
 
 OOCJCDO 
 
 OCOVO^'':*- 
 OOt^co vo Tf 
 
 NO CO 00 r^ CO 
 On vo NO c > 10 
 r-i T-H cvi vo c:^ 
 
 OCM^NOOO 
 -— I O On lO l^ 
 ■^ -^ t-O CO CO 
 
 c5ocDoo 
 
 00 vo 
 
 00 CM 
 
 CM O 
 v/o v/^ 
 
 ^ NO 
 t^ CO 
 
 CO CO 
 
 d>d> 
 
 r^ONr-H 
 
 CM NO NO 
 CMOt^ 
 COLO CM 
 
 r^oo 
 
 Tf NDO 
 Ot^io 
 CO CM CM 
 
 --I COO CM vo t^ 
 
 r>sr^cN -^Lo ON 
 
 tN. C7N Tf r- c On cm 
 
 LO Ot^ NO On CO 
 
 rf '--1 r^ CM CO O 
 
 NO 10 LO CO CM CO 
 
 CM O 00 NO vo CO 
 
 CMCM '-"-"-I ,-. 
 
 000 00000 O 
 
 ThNOt^cOON '-•COCMCMO OO'^OONOCh Q O O 00 rj- ro O vo NO O 
 
 NOr-iTfvoco r-HOOt^OO OnCOtTCOOn "^-t^vOTj-co OOt^CMvot^ 
 
 t-^r^CMOOO cO'-i'^Ort OCOcoconO O^OOCOOn COOnOCTnno 
 
 rrCMOOr-iO r^OCTNTf^ OOnONOO O^nOvOI^ cmcmcococo 
 
 C^JOON^Tl- COloCMCMco NOOvocm^ OCM'^OOC'-J O'— i'-'J^CO 
 
 Tt^cOTt-Tj- -rt-LONOl^OO CTnt- iCMrfNO COOCM'^f^ OvococoNO 
 
 ONCOr^NOLO ■<:fcoCM'— lO C3NC7\OOt^O lolo-^coCvJ CMCOvoC^lC^ 
 
 iOLOlOlOlo vovovololo -tJ- -^ tT rf ■^ "^ -"^ "^ '^ '^ Tj- CO CO CO CM 
 
 OOOCDO OCDOOO OC3CDOO O O O CJ O CJ C) CD CO CD 
 
 TfrfCMCMOO CM 
 
 '-"-I Tj- 00 r-i (N^ 
 
 ON'-^CMNO'-i n- 
 
 '-^OVOTfr-^ CM 
 
 CM NOCO COrl- rf 
 
 CVl C?\ 00 On CM NO 
 
 t^rl-CM OON t^ 
 
 CM CMCMCM T-H ^ 
 
 CD (DO CD O CD 
 
 CO^CM OOtv. 
 
 Tj- 00 CTn VO o 
 CM l^ CM LO -^ 
 
 N0O0n-hi>^ 
 :-v CO On GO r^ 
 OnOO "-i CM 
 CO CO CM ^ O 
 
 NO vo NO NO ^ 
 
 CDOOCDCD 
 
 00 Tt ON CO NO 
 
 o i^ o 01 c^a 
 
 NO Oi CO rr .— I 
 
 NO 00 T}- CM CO 
 00 O'^ CTnlO 
 COLO NO t^ ON 
 
 On 00 r^ NOLO 
 
 LO vo vo LO LO 
 
 CM onlo cor^ 
 
 CO LO CM LO NO 
 
 CM to c:^ .-I O 
 
 NO '-'00 OOC?N 
 
 CM —lOr-H CO 
 >— I COLOl>* ON 
 vo -rf CO CM '-' 
 vo vovovovo 
 
 00000 00000 
 
 •*1-VOCMO vo 
 
 OnnO -— ' t>.t^ 
 Tt (M CM r-H On 
 "-I to O NO CM 
 
 l-^ ^ l^ CO '-' 
 
 1-1 Tl- NO ON CM 
 »— OONCOOO 
 vo O -^ Tf rt 
 
 OOCDOO 
 
 00 O I^v '-< CVI 
 NO O C?nCM ON 
 Tj- COvo CO NO 
 OCM CjNCOt^ 
 
 OOnCMOnnO 
 
 vo o c^ chCM 
 t^ Tt- or^ vo 
 
 Tf -^Tj-CO CO 
 
 ooc>oo 
 
 ONvor^ 
 
 CTn'-"-' 
 vo O ON 
 
 r^ o^. oc. 
 cooo o 
 
 t^ COCM 
 
 CM C'CO 
 CO CO CM 
 CD CD CD 
 
 OOOn rt 
 
 '-' On "^i- 
 
 CM NO CTn 
 
 VONO C^J 
 
 00 O NO 
 
 '— I CO vo 
 
 NOTf CM 
 
 CM CM CM 
 
 OC> CD 
 
 nOOOOOnCM 
 
 00 coTJ■r^Tt 
 oooo oooooN 
 
 CO CO CANOrt- 
 OO O --I COLO 
 
 CO 00 1^ NO LO 
 
 NO NO nO no no 
 OOOCDCD 
 
 I^NOCM 
 
 r^ ^ CM 
 
 '-' C7NLO 
 
 00— ' 
 
 ■^rf LO 
 t^ CTn--^ 
 ■<^ coco 
 
 NO NO NO 
 
 COO 
 
 r>»io 
 
 00 CO 
 
 t^O 
 CO NO 
 CM^ 
 
 NO NO 
 
 Tj- NO CM NO NO 
 CO OLOio O 
 
 CO CM CO NO O 
 1— ' O CO LO C^l 
 Tf CA ''I- T-H ON 
 
 COOCONOCO 
 
 Ot^ On On On 
 On C3N '-• Tj- 1^ 
 CM CO CM NOLO 
 t^ '— < Tj- 10 vo 
 t^t^t^ 000 
 '-"^t^OTt- 
 t^ NO vo vo TJ- 
 Vi ) to 'O to vo 
 
 00000 00000 00000 
 
 vOCMOvovo 
 
 OONNOt^O 
 
 ONCOt^i\ ON 
 
 C'l !>. NO aj CM 
 
 CO OnVOON r-- 
 
 t^ Ti" Tj- 10 On 
 
 CO Ot^ rf r-l 
 VOVOTtTfTt- 
 
 OCDOCDCD 
 
 tv.ONNO 
 OOt^CM 
 t^NOrf 
 
 oovor>. 
 00'— 00 
 coot^ 
 
 CTNl^rf 
 COCO CO 
 
 CDOd 
 
 VO'-l NO 
 
 CM C3N CM 
 
 Tf vo CO 
 
 CM CO CO 
 
 CTvCM t^ 
 
 NOt^ 00 
 
 CMO 00 
 
 COCO CM 
 
 do d 
 
 CMvO'-*t^Tf 
 
 CTn ^ '-' Oco 
 CMt^ Tfcoco 
 Cvi t^ O O t>^ 
 CJN vo CO '-< C?N 
 
 Ovoor^t^ Tj-»-HCMCMNO 
 
 CMOnOvconO '-I --I CJN C?n t}- 
 
 TfT^r^coON cOcoCOCJNtO 
 
 >— ' CM O LO NO LO O >— ' ON -^ 
 
 C^NChO-— 'CO vo O T}- CO -^ 
 
 LOOOCMLOOO »— iLOOO'— 110 
 
 O0NC?NC0r^ r^NOtoLO-'^ 
 
 t^NOVONOvq VONONONONO 
 
 <Dci<z$ci<z> (zic^dc^d ddcDciiZ^ 
 
 CM Tj- r-H ,-t r-t 
 
 OiNOOTj-CM 
 Tft^ COCDC7N 
 to CM NO NO .— ' 
 01^ TfCM T-i 
 C3NCMNOOTJ- 
 COCOCMCM »-H 
 NO NO NO VO NO 
 
 CVIOOCM 
 
 OOONO 
 
 0000 o 
 
 COCM rf 
 OtOTj- 
 00000 
 O t^ to 
 
 NOLO vo 
 
 CM NO 
 ON 00 
 cOTt 
 co '-' 
 t^ CO 
 coco 
 CM 0\ 
 vorf 
 
 ONTj-'.tOO r^ 
 
 Tj- CTn CM r-l C-1 CM 
 
 or^ CO '-I o '-' 
 
 CM r-H CM ONt^ T-H 
 
 '-''-' CM CO vo l^ 
 
 "«t »- ONOOOQ On 
 
 r^ vTv CM o 00 NO 
 
 ■^■^ "^ Tf CO CO 
 
 00000 00000 00000 o 
 
 O— "CMco-"^ lONOl^OOOx Oi-HCMCOTf lO vo tv. 00 0\ OvoQ^OO vo ' 
 COCOfOCOCO COCOCOCOCO Tt rj- Tj- Tj- Tj- tJ- tJ- t^ tJ- rj- vo 10 NO NO t>^ t>» ( 
 
 110 0*0 
 
 I 00 ON On 
 
342 
 
 TABLES 
 
 H 
 tn 
 W 
 
 w 
 
 H 
 
 p 
 o 
 
 < U 
 
 w 
 
 W 
 PL, 
 
 /--S 
 
 ^ 
 
 CO 
 000 
 
 
 fOTfOOVO 
 
 r^rr^i>Hvo 
 
 00 CONOCO NO 
 
 NO 00 CM On '-' 
 
 COOONOlO 
 
 COCOLO-^l-Tf 
 
 
 r^Ti-cMvo 
 
 ^iOt-h COTJ- 
 
 ooot^ogco 
 
 t^LOcoOON 
 
 OCMTft^O 
 
 r>.Tf^CNjio 
 
 NOQON-Hl^ 
 
 ooOr^ONO 
 
 
 VOvOONfO 
 
 lonOtJ-co CO 
 
 rl-LOiOt^ 00 
 
 
 rOCh^ O 
 
 vo NOLO r-H On 
 
 On 00 NO CO O 
 
 NO ^ NO Tf T-H 
 
 OLOOONt^ 
 00-^vot^ON 
 
 ON -^ NO COLO 
 
 On 00 CO NOLO 
 
 ^ 
 
 cnonotj-oo 
 
 CO l^ On 00 CO 
 
 CM NO CO COLO 
 
 coa\o\c\) 
 
 l>^ -rl- lO t^ .-1 
 
 00 NO NO 00 Ol 
 
 t^co-HOO 
 
 »-i Tt rv. 1-1 NO 
 
 CM ONl^LOTf 
 
 CO r-H O OnCO 
 
 NO 
 
 T^00^^O^ 
 
 Tf ONOCvi On 
 
 LOCNJ OnNOtI- 
 
 »-H On l^ i-O CO 
 
 »-• ONt^NO Tf 
 
 
 On 00 00 t>. 
 
 t^ r^ NO NOLO 
 
 lO LO -^ Tj- rt- 
 
 Tf coco coco 
 
 CO CM CM CM CM 
 
 CM CM CM '-H T-I 
 
 
 --^OCJOO 
 
 d>d>d>d)d> 
 
 d>d>d>d>d> 
 
 c5d>d)-d>d> 
 
 c>»d>d>d>d> 
 
 d>d>d)d)d> 
 
 
 loooor^ 
 
 rxOcoNOCN 
 
 LO On Cvj LO lo 
 
 OCM On LO NO 
 
 oONor^T-^^ 
 
 t^ CO CM ''t CM 
 t^t^ CO NOco 
 
 
 ctn rr voT^ 
 
 ^ rJ-COCOON 
 
 <N CNlTfCOON 
 
 »-H LO VO NO On 
 
 t4- CO 00 CO ON 
 
 
 OONt^sOvl 
 
 NO LOT-" ON 00 
 
 CO ON l^ r-ll^ 
 
 r>» r—\ \C) o CO 
 
 C?N CM On i-H l>. 
 
 C^l O 00 CO NO 
 OTtrrON-^ 
 coraoo O C3N 
 
 
 OOCNJ coo 
 
 Cvj •-« OOfO Q 
 LOCNJ NO CGNO 
 
 r-H>, COCNNO 
 
 »— < »— • On Cv) CO 
 
 OOTf tM^nO 
 
 ^ 
 
 coooot^ 
 
 On NO CO CO O 
 
 O T-H C-l LO t^ 
 
 00 ON 00 LOO 
 
 vooO'-^Loo 
 
 CM rN. coc^ 
 
 S^^S^:^ 
 
 CO-<* NOOLO 
 
 1-t COLO coo 
 
 »-• 00 NO -O LO 
 
 lOi-Ht^LoCM 
 
 lO 
 
 lOO ^ 0^ 
 
 OOlocO'^ ON 
 
 t^LO -^CM «-• 
 
 CO CO CO CO CO 
 
 On 00 NOLO Ti- 
 
 
 On ON 00 00 
 
 t^ l^ t^ NO NO 
 
 vo LO LO LO LO 
 
 Tf rf Tf rf CO 
 
 CM CM CM CM CM 
 
 
 '-; o o d o 
 
 d>d>c5d>d> 
 
 d>d>d>d>d> 
 
 d>d>d>d>d> 
 
 d>d>d>d>d> 
 
 d>d>d>d><zi 
 
 vO 
 
 8^§;^ 
 
 LOTtNOCOfO 
 
 00ThNO'«t^ T}-CN10Nt^0\ 
 
 NOt^OONOOO Tj-cococot^ 
 
 VOCOONCOt^ 
 
 QOOt^ ON CM 
 NO -^ CO NO O 
 
 ©=^ 
 
 r>s o\^ '-' 
 
 r-H U-) 00 LO -rj- 
 
 r^ooco^CM 
 
 OONNOO--H 
 
 C^t^OOco 
 
 cooo^t^^ 
 
 ^ 
 
 COCVJ 0\V0 
 
 LO OnCNJ 00 o 
 
 n-oooo^ON 
 
 CM ONNor^i^ 
 
 (MNOt^OO 
 t^rf^f-^co 
 vOTfco 1. 1 CO 
 
 '^OOOLOO 
 
 Nor^t^ cot^ 
 
 QNt^CvlvO 
 
 On ^ NO CM On 
 
 NO NOLO to LO 
 
 t^Tf NOLOO 
 CMOOTfr-HON 
 
 T^ 
 
 VOJ^VOOO 
 
 cgr^'^corvj 
 
 rr NOONCOt^ 
 
 
 lO'-tr^ CO 
 
 O NO CO Ot^ 
 
 r-H On l">. LO CO 
 
 T-H ONt^NO Tj" 
 
 CO »-i O ONtN. 
 
 
 ON On 00 00 
 
 00 l^ I^ I^ NO 
 
 LO -^ ■<^'^ rt 
 
 Tt* CO CO CO CO 
 
 CO CO CO CM CM 
 
 
 '-^cJddd 
 
 d>d>d>d>d> 
 
 d>d><5d><:^ 
 
 d>d>d>d>d> 
 
 <5d>d>d>d> 
 
 (ocDdxzici 
 
 
 vO^vOOn 
 
 ^CO^T-HTt- 
 
 r^ CO LOON 00 
 
 OCOLOCMCq 
 
 LOO On CO tv. 
 ON NO CO CO rt 
 
 Ocot^xt^^ 
 
 
 
 rlLOOOCMr^ 
 
 ^ONOOO 
 
 irj ^ CM '-H Tj- 
 
 00C^^LOTtTt■ 
 
 
 OO ^ ^ '^ 
 
 r^ Tj- 1^ o NO 
 
 "^ o l^ '^ "^ 
 
 NO 00 On l^ t^ 
 
 T^oocoooc^^ 
 
 NO COLONO i-l 
 
 
 
 COLO 0\ o 
 
 <N-H^ON00 
 
 NO O t^ C^l rt 
 CM ON CO NO NO 
 
 00 COLO CM CM 
 
 T-H 00 T-" l^ LO 
 
 -^NOooT^No 
 
 LOONO CO o 
 
 ^^5. 
 
 lOLo OnOO 
 
 On CO On NOLO 
 
 XOLOLOLO-^ 
 
 CO 00 On t^^ 
 
 vocM oom 
 
 -H o ON O <M 
 
 (V) ON LO COO 
 
 LT J On '^ O l^ 
 
 LO coco CO rf 
 
 NOCO '-'LO O 
 
 Tf 
 
 r^ Tf CM Ot^ 
 
 LO CO '-' On t^ 
 
 LOCOCM O On 
 
 
 OS 0\ 00 CO 
 
 00 l^ !>. t^ tv. 
 
 NO NO NO NOLO 
 
 LOLOLO Tj- T^ 
 
 CO CO CO CO CO 
 
 
 'r^d>d>d>c5 
 
 d><Dd>d><:5 
 
 d>d>d>d>d> 
 
 d>d>d>d>d> 
 
 d>d>d>d>d> 
 
 d>d>d>d><o 
 
 
 tN.O'-HCO 
 
 r>v^vovor^ 
 
 »-< .-lOLOON 
 
 CM'-hOO'^On 
 
 OOOCOCOCO 
 
 C7N t^ -rl- Tt lO 
 
 
 lor^r^cvi 
 
 OOt^ cO'-Ht^ 
 
 NOONt^-HVO 
 
 
 ON NO CM CO ^ 
 
 
 COO(N1CV1 
 
 t^oS^^ 
 
 OOLO COTl-,-1 
 
 O LO CO '— t LO 
 
 LO o o LO r>s 
 
 NOt^C^TfOO 
 
 rtco— 'lOTj- 
 
 ^ 
 
 00,-Hrf Tj- 
 
 T-H TfOOOOO 
 
 OnO ONOlo 
 
 NOl^LOOOlO 
 
 T-tiOOsrl- 
 
 ONlOON-^t^^ 
 
 ONONt^Tj-t^ 
 
 00 l^ CM CO 1-1 
 
 LO LO i-H CM On 
 
 r-'OOONOgg 
 
 :^ 
 
 vo poor>. 
 
 »-< coloOnco 
 
 00 Tf-T-H ONt^ 
 OOO NOCOr-H 
 t^ NO NO NO NO 
 
 NONOt^OOO 
 
 CM LO ON CO 1^ 
 
 CMOOnOONO 
 
 ■^^ 00 LOCO 
 
 On t^ LOCO CM 
 
 O 00 NO LOCO 
 
 PO 
 
 ON 0\ ON 00 
 
 00 00 t^ t^ t^ 
 
 tOLOLOLOLO 
 
 LO^rl-TtTl- 
 
 Tj-Tl- cococo 
 
 
 T^dxdtdxzi 
 
 d>d>d>d>d> 
 
 d>d>d>d>d> 
 
 d>d>d>d>d> 
 
 d>d>d>d><5 
 
 c5<zid>d><^ 
 
 
 0\'-< VO"^ 
 
 OOvOr-^COCO 
 
 ON CM 00 CO 00 
 
 lO tJ-lo •— • CO 
 
 LOOOOLOTj- 
 
 1^ CO NOLO NO 
 
 
 t>^0\^0 
 
 r> eg LO cvj t>^ 
 
 ONON-rfNOO 
 
 i^ CM 'J^ t^ r>* 
 
 lot^ or^co 
 
 
 COlO i-il^ 
 
 OOrf T-H ONNO 
 
 CO-HON-Ht^ 
 
 '-'NONO^NO 
 NO NO --^ ON 00 
 CO.-I O coCvJ 
 
 lOOnCM-hco 
 
 LO-^CJNNO^ 
 
 SS22oco 
 
 
 fN^ONTfOO 
 
 OoO OnO T-i 
 
 ONCMt^LO 1-H 
 
 r^TTONONCo 
 
 
 O C^l lO 00 
 
 ^Tj-O^"^ 
 
 
 NOLO 00 NO ON 
 CO t^ «—l NO »-H 
 
 ^ 
 
 f^ t^ CO On NO 
 
 ^CMoSS 
 
 1-1 CO LO r^ O 
 
 r^coo t^-^ 
 
 S^^5^88 
 
 NO CO r-t OOnO 
 
 Tj-cMooor^ 
 
 lOCOCMOOn 
 
 t^NOLO COCNI 
 
 to 
 
 CO 00 CO t^ i^ 
 
 t>»iv.r^ voNo 
 
 NO O NO LOLO 
 
 lO LO LO LO Tj- 
 
 TtTf rfTfr^ 
 
 
 ^dddd 
 
 <Z)<z> <zi ci> <d> 
 
 d>d>d>d>d) 
 
 d>d>d>d>d> 
 
 d)d>d>d>d> 
 
 d><5d>d><o 
 
 
 r-l COOSfO 
 
 O^OOLOlO 
 
 OOnCM cooo 
 
 ^ooooo 
 
 00 -^ tT CVI NO 
 
 t^OOLO-^O 
 
 NO NO I-" 1^(30 
 CMOnCNC^I^O 
 
 
 vooor>.Lo 
 
 CO 00 CO NO 
 
 On '-' '^CMCM 
 
 r^(MLO On ON 
 
 LOONf^t^O 
 
 
 
 t^ CO -^ r^ r^ 
 
 O'^'^COrl- 
 On I^ CO LOCO 
 
 OCOCOOOOO 
 
 ^t^OOCMO 
 
 ^ 
 
 LOoO^oS 
 
 On On CO O ON 
 
 LO ONLO ^t^ 
 
 CM CO 1-iLOCO 
 
 
 '-'l^O ONCO 
 
 CO On^ 00 On 
 
 NO COLO NO CM 
 
 CM NOLO 00 Tt 
 
 LOONt^OOcO 
 
 ;^ 
 
 CO tv. '— 1 t~>» 
 
 COONl^-rtTO 
 
 CN) T-iCMCMco 
 
 Lor^ocor>» 
 
 T-ILOOLO T-4 
 
 r^ CO o t^ LO 
 
 ooNCONOii2 
 
 t^ TfCM ON 
 
 SoSS^g?^ 
 
 NO Tf-CMOOO 
 
 NO NO NO NOLO 
 
 OOnOlocoCvI 
 
 CVJ 
 
 ON On On 00 
 
 t^t^l^t^NO 
 
 LO LOLO LOLO 
 
 LTj T:^ T^ Tf Tf 
 
 
 y-^d>d)c6d> 
 
 d>d>d>d>d> 
 
 <5d>d><z>d> 
 
 d>d>d>d>d> 
 
 c5d>d>d>d> 
 
 d>d>d>d><::^ 
 
 .2 
 
 (2) ,-1 CVl CO "^ 
 
 »OvOtxOOO\ 
 
 O'-'CMcOTt 
 
 to NO 1^00 ON 
 
 O-^CMCO-H- 
 
 lONot-xOOOi 
 
 
 
 
 »— t T-^ »-^ t— t »— • 
 
 ^^^^^ 
 
 CMCMCMCMNM 
 
 CNICMCMCMCVI 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 343 
 
 •-^ O) Tf c^i in 
 
 OTf rv. vo 1— I 
 
 1—1 XT) ^J-i CO r-> 
 
 '-' CM ON^ 0\ 
 
 t^ O lO t:!- CO 
 
 O "^ 0^ coio 
 
 OCMio C\ro 
 
 COCVI i-H OO 
 
 ooooo ooooo 
 
 C^^-hC^ICM o 
 
 o-ir^io vo o 
 
 r^ ^ o "-H r^ 
 
 On ON coco t^ 
 
 ooooo 
 c5ooc5o 
 
 OOO cOTfvO 
 Ot^ OOO0u-> 
 xi~> r^ ■LD 0\ -rt 
 VOlO VO OMO 
 CVIOO Tj-Ot^ 
 t>^. ^O VO voio 
 OOOOO 
 
 c>o ooo 
 
 co-^ covocrs 
 oot^ '^C^lt^ 
 OO vo T-Hiocq 
 Cvl u-) CO VO 0\ 
 
 Tj-o orgvo 
 
 lO Tf CO Cvl T-H 
 
 ooooo 
 
 OOCJOO 
 
 »-il0O<0*0 CO 
 
 T-i,-.c\]oo cq 
 
 O\<v>ro00rt tN. 
 
 rj-iovor^-^ rf 
 
 vOrt OCVJ Oi 0\ 
 
 CM Qvt^voco CM 
 
 OOOOO o 
 
 OOOOC) C) 
 
 lor^^^r^o 
 
 CDN^COVOt>^ 
 
 OOQCMOfO 
 
 NO^NO-* CO 
 \n r-i 0\ 'rt i-> 
 
 ^00 -H^^ 
 
 POOCMOOt^ 
 
 O00C?N^t^ 
 
 o\ 
 
 Tf-rJ- ^LO CO 
 
 cvi Tj- \o CO On 
 
 VDVO CM ^ On 
 
 CONOIONOMD 
 
 lO On '-I (?\ Tj- 
 
 
 t^CA^CM Tt- 
 
 ot>»ioior^ 
 
 NO NO On CM CO 
 
 '-HNOONNOlO 
 
 T^ 
 
 t^iovor^io 
 
 OMOCOO^ 
 
 Tj-OOcoOVO 
 
 ON ON TT'^ NO 
 
 OCM COTJ-NO 
 
 iOt>^O00O 
 
 S 
 
 CO CO coco CO 
 
 i-hCMtI-nOOn 
 
 ocMcor^oo 
 
 CM CO lO On 00 
 
 t^.-H oocot^ 
 
 '-hOOnOnO 
 
 CM lO 00 CM NO 
 
 '-O OOnOn 
 
 t— < f-H y—l C~) O 
 
 t^ 00 CO 1-1 CM 
 
 ioOioCMOn 
 
 t^ 
 
 rOCMOCAOS 
 
 oor^^oio-^ 
 
 Tf COCMCVJr-H 
 
 00 NO V^'^ CO 
 
 OOOOO 
 
 gSSS8 
 
 8 
 
 d 
 
 oc:Jc5do 
 
 <D<zS<5c5<5 
 
 c5c5c5<5c5 
 
 c5ci<=ic5c5 
 
 CMi-H^»-^0\ 
 
 Ttt^r-.Tf ON 
 
 or^voTfvo 
 
 t^CMO^OO 
 
 >ntN. ,-.T^t^ 
 
 ONOOrot^CA 
 
 CO 
 
 OTfO\CM C50 
 
 Tf .-H CM Tt Tf 
 
 t^O CMiOt^ 
 
 coco^t^io 
 
 vOOOOnCDn 
 
 Tj-rj-Oi-HON 
 
 NO 
 
 ocv) a\ '-^lo 
 
 rfOO ONOio 
 
 OOioOOCM 
 
 "^ CO 00 t^ 1-1 
 
 OnOnCMj-)tJ- 
 
 vo 
 
 OiOTj- onoo 
 
 lOCM ONIOVO 
 
 CM CM ^ vo t^ 
 
 VOCM COCTnC^N 
 
 t^OOCM^S 
 
 CO lO CM CO t>s 
 
 lO 
 
 CM O ^-T^VO 
 
 OMO-^ VO "-H 
 
 ONOCOOONO 
 
 oomr>.oCM 
 
 CM 
 
 tN. to Tl- CO C5 
 
 Tj-ioNOr^ON 
 
 r-.Tj-|^OTt 
 
 t^CM NO Om 
 
 o 00 '-it^io 
 
 NO C3n CO C7MO 
 
 CM 
 
 VO vOTt coCM 
 
 '-'OONOOt^^ 
 
 t^ voioio^r 
 
 COCOCMCM'-H 
 
 T-i oor^io""^ 
 
 COCMCM^^ 
 
 
 CM CM CM CM CM 
 
 CMCM'^'-H'-' 
 
 
 
 i-OOOO 
 
 ooooo 
 
 o 
 
 CDC)C5oo 
 
 cDOCJdd 
 
 cDCDodd 
 
 (Z>cicid><5 
 
 <D<od>d>ci 
 
 (Dcici<^(^ 
 
 d 
 
 t^VOTtt^CA 
 
 t^CMiOCO^ 
 
 rj-COCOOiO 
 
 ,-H vonOnoCM 
 
 CMi— QCMO 
 
 t^COiOOOO 
 
 g 
 
 vOCM On '— ' O 
 
 Tft>^ 00 Tj-vo 
 
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 -^OOiot^^ 
 
 NO lo "^ r^ tj- 
 
 NOCOt^ONtX 
 
 00 O l^ -^ CM 
 
 lO 00 NO too 
 
 OS t^ "^ 00 NO 
 
 OOCO CM rJ-i-H 
 
 CMioOCMCA 
 
 COTfOOOO C?\ 
 
 Q 
 
 y-<\0-LnO\tn 
 
 COt^t^NO"^ 
 
 CTN^COCA^ 
 
 T-. U-) NO CO i-H 
 
 
 § 
 
 CO'^OOIO 
 OOvOiOrfco 
 
 T}- NO CM CM ^ 
 
 CM CMm 1-1 CD 
 
 coo CM lO 00 
 
 I-- NO CM r- CO 
 
 t^ NO O i-H CM 
 
 l^ CO NO CO O 
 
 cocorJ-iOvO 
 
 tv.NOmiO'^ 
 
 O»nio00T}- 
 
 CM cotOCJN"^ 
 
 On 
 
 OONOOt^ MD 
 
 lO rf CO CM "-I 
 
 O O O\00t^ 
 
 r^1-H ONt^NO 
 
 mrfcoCMCM 
 
 T— 1 
 
 CO eg CM CM CM 
 
 CM CM CNJ CM eg 
 
 CM CM '— • '— ' '—' 
 
 »-H 1— ( 1—1 T— I r-t 
 
 -^-HOOO 
 
 OOOOO 
 
 o 
 
 cDOocrJd 
 
 dddcDo 
 
 dcDodd 
 
 d>d><5d)C> 
 
 c><5c5<:5cD 
 
 <5c>c5cS^ 
 
 d 
 
 ,_U-)r-l ^lO 
 
 vOCM^TfO 
 
 r^tv.00^ 
 
 Tj-t^OOlOTj- 
 
 t^rJ-^OOCM 
 
 oiotxiniTj 
 
 C?nOOOO OnCO 
 
 ^ 
 
 TfCOt^lN. O 
 
 ooo On CM VO 
 
 OOt^VOCNlO 
 
 rf CO '-I CTnco 
 
 CMOOVOTl-CM 
 
 ONt^CANOO 
 
 cOi-H COCM^ 
 
 ,—1 
 
 VOCM'-Hr-HCM 
 
 CM '-< ONiOCM 
 
 CO 00 Tl-iONO 
 
 LOCM '-' cor^ 
 
 S 
 
 r^ COCO -^r^ 
 
 r^cocoNO 1-H 
 
 t^ cot^OC3 
 
 lo or>x00 '-' 
 
 lONO i— 'OCM 
 
 mm CO t>. 00 
 
 Noo\^CMr>» 
 
 CMCM vOCOrt- 
 
 ONCOOiO-rf 
 
 NO -^lO 00 CO 
 
 Ot^ On 00 On 
 
 t^t^t^CMO 
 
 o 
 
 VO -^CM '-I O 
 
 
 CM T}-iOt^ O 
 u-)n-coCMCM 
 
 CM U-) 00 '-' vo 
 
 CAO NO NO CTn 
 
 lOCOCOlOOO 
 
 CM 
 
 to Tl- CO CM '-H 
 
 On 00 00 l^>. NO 
 
 --^OC^nOnOO 
 
 t^iO CM OOO 
 
 t^NOlO'<^CO 
 
 CO 
 
 CO CO CO CO CO 
 
 CM CM CM CM CM 
 
 CM CM CM CM CM 
 
 CM CM '- ^ r-H 
 
 ^^^^o 
 
 OOOOO 
 
 o 
 
 d>c:>d>d>cS 
 
 <5cici<5d> 
 
 c5(zi(Z>cid> 
 
 c5c5ci(5(5 
 
 c>d>cici<^ 
 
 <5c^c5(5ci 
 
 d 
 
 VOlOCOlOO 
 
 Ocor^lO^O 
 
 tJ-OCMtJ-00 
 
 CMCOVOOON 
 
 OOt^CAtOVO 
 
 »-<Ot^ONCM 
 
 S 
 
 t^'-t OCM C7N 
 
 ■rr Tj- ON 1— ' lO 
 
 
 vOiOt^OOOJ 
 
 Oi-hOCMCO 
 
 CMi— I tM^ CO 
 
 vor^t^ vo-* 
 
 CO CM CM NO CO 
 
 NO 00 On cm '— ' 
 
 00 NO CO 00 o 
 
 t^t^cocor^ 
 
 vnt^iorN.o 
 
 CM 
 
 00 CO CO CM T}- 
 
 00 CO 00 C^l lO 
 
 mCMiOTM^ 
 
 COCOIO CJNtO 
 
 ONOCO»-H ON 
 
 ""l-t^NpCMCM 
 
 CTn O CD C3n CO 
 
 CO 
 
 ONCNCOO O 
 
 coo ON CM t^ 
 
 lONOCAu^ro 
 
 Tt-t^CM OnOn 
 
 i-^r^t^^CM 
 
 00 NO ON NO NO 
 
 ^ 
 
 
 lo lo •^lom 
 
 NOt^OOOCM 
 
 T^-NOCTN^Tt 
 
 
 CM 
 
 i-H onoo t^^ 
 
 lO TfCOCM '-' 
 
 OONOOOOt^ 
 CO CM CM CM CM 
 
 NOlOTl-Tj-CO 
 
 CM ON NO rf CM 
 
 \r> 
 
 Tj- CO CO CO CO 
 
 CO CO CO CO CO 
 
 CM CM CM CM CM 
 
 CM^^^^ 
 
 Soooo 
 
 O 
 
 d>d><:5d>d> 
 
 dCDOCDCD 
 
 ddddd 
 
 cicDdcici 
 
 CDCi<DCi<zi 
 
 c5<5<z>c5<5 
 
 d 
 
 ,-« ^ COOOQ 
 CM On O OCO 
 
 ■^r^Noc?Nvo 
 
 ^^^^5 
 
 CMCMCOOCM 
 
 cOi-hOnOOnO 
 
 CMCMOrhON 
 
 ^ 
 
 1— c CMlOlO'-H 
 
 or^i^-^CM 
 
 OO^l^^CM 
 
 CM-^'^CMVO 
 
 Tf CO r-H 1-^ CO 
 
 CO t^ 00 ON CO 
 
 C^gg^g 
 
 t^ 1— it^ On '-H 
 
 t^mNor^t^ 
 
 CM rf NO CM 00 
 
 NO 
 
 rfoo "^Or^ 
 
 cor^ CAoOTf 
 
 ONO'-^ CO NO 
 
 t^ Ot^^ '-• 
 
 •^ 
 
 »-< CM r^ lo to 
 
 ON lO -rj- vo '-^ 
 
 oooooTi-^ 
 
 ON^Tl-c^NO 
 
 lO CACO-^t^ 
 
 t^ i-iNO OOn 
 
 CO 
 
 CO •-< On 00 t^ 
 
 NO NONo^r^ 
 
 1^00 O "-I CO 
 
 rfr^ C7\'-< Tf 
 
 t^ Tj- NO I— ' On 
 
 0"^CAt^iO 
 
 NO 
 
 T^ CO 1— ' o ON 
 
 COt^NOm Tl- 
 
 CO<>JCM^O 
 
 On 00 1^ t^ NO 
 
 m CM On tv^ T:t- 
 
 COT-HONOOt^ 
 
 NO 
 
 Tl- Tt Tt- Tt CO 
 
 co CO CO CO c»^ 
 
 CO CO CO CO CO 
 
 CM CM CM CM <N 
 
 CMCM'""-^ 
 
 '-"-.ooo 
 
 ^ 
 
 dddczJd 
 
 dddcDo 
 
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 c5(5<z^<5<5 
 
 c5cici(5ci 
 
 ddddd 
 
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 0«-'C<J<^"* vovOtxOOON Oi-iCMco-^ mNOt^OOON OtOQvoO lO ' 
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 iOO»0 
 
 OOOnOn 
 
344 
 
 TABLES 
 
 
 CO CVJfOioOO 
 
 VO lO t^ 1— t CA 00 
 lOto oovooiooo 
 
 CV> CO fO t-i T-i 
 
 CO l>% -^ "-H U-) 
 
 lOOO TfCOlO 
 CVlCOlOt^ON 
 
 CM r-i 
 
 lOiOCM 
 
 OO'-H 
 
 »-<C^cOTf »ovot>.ooo\ 
 
 t^^coONt^OO 
 i-H\OCM ^CM 
 OOMDiO Tj-io 
 
 CO "^LO""^ 0\ 
 
 CO COIOO CO 
 OOOOntJ-^ 
 
 Csi "^ r^ '-' »J^ 
 t-h' cnJ CO lo vd 
 
 V0C0»O»-tC0 
 
 VOTfOOOt^ 
 CviCMcorJ-O 
 0\CNU>. CO o 
 
 COOO^O OOrJ- 
 C^coOOcoON 
 
 VOCM 
 ■rj- CO 
 
 lO «-H 
 
 iot< 
 
 CM CM 
 
 OOOO 
 On CO C^ 
 
 lOCM CO 
 
 OOtJ-O 
 (M ^ On 
 
 com CO 
 
 odocM 
 
 CM CO CO 
 
 coco CO "^r^ 
 
 COOOO OiO 
 VOOQOO\ 
 l^l^O OOCM 
 
 tN. r-«CM On^ 
 
 in y-< l—^ U-) in 
 
 ripOxGOOO 
 CO CO CO CO rj- 
 
 Q 
 o 
 
 w 
 
 u 
 
 w 
 
 o 
 
 ^ Q 
 H !^ 
 
 w o 
 
 <: 
 
 o 
 
 H 
 
 o 
 
 < 
 
 CM 
 
 CM 
 
 
 
 ^ 
 
 CM CO 
 
 VOVO 
 
 8 CO 
 o 
 
 CMOOt^ 
 CMOCO 
 
 OOt-h 
 
 t^Tj-ooooo 
 
 OM^CM '-' CO 
 '-hOnCM^On 
 »-i t^ VO '-H 0\ 
 Ot^OONCO 
 corfONiOiO 
 CM CO -^VO 00 
 
 irJvdKocJOx 
 
 rj-t^r^vooo 
 
 OOCMt^t^ 00 
 
 o^CMr^o 
 
 t^OvCM CM t^ 
 iOTl-(M00co 
 
 OCO^OOnCM 
 t-H CM CO Tj^ vd 
 
 O'-Ht>X^V0 
 
 COt-hioiO VO 
 '-HOOCACM On 
 OiOnt-h vOTf 
 '— I CO O t^ CO 
 OniocoCMu-j 
 OO CO ChOO 
 
 vqp'^oqco 
 
 t<C7NO >-< CO 
 ^^CMCMCM 
 
 COCOON 
 OCMCO 
 OOnOn 
 CMCMTf 
 
 lOONO 
 
 r-iCMr^ 
 
 ^t^vo 
 O^T^o 
 
 r-(00 
 
 OCO 
 CM CO 
 
 ^^ 
 
 ON NO 
 
 vOco 
 
 vocoooot^ 
 
 On VO li-) T-H VO 
 VO '-' O CVI VO 
 »-i cor^ CMi^ 
 
 COt^OTl-00 
 
 OOO' 
 
 CM 
 
 cOTfVOOOO 
 COCOCOCO '(I- 
 
 \OVOC50iOfO 
 i-hOncoi" ■ 
 00 OOCO( 
 
 §i2 
 
 _ rfCMOOvOCM 
 
 ■NO O "-I (M CTn VO 
 
 "^OOTj-CMTt 
 
 (MMDCM 
 
 iCMCO"^ iovdKooo\ 
 
 OCMCO CM irj 
 
 0"^I^IO r-( 
 
 1— I lo CTn 1— I 00 
 CMt-hOOcoco 
 t^t^Oco On 
 On 00 CM OCO 
 
 OOsJf^"*"^ 
 
 CMiOMDOOcO 
 C7NCM On covO 
 VOLOOCM 00 
 
 '— I oor^ T—i lo 
 
 rfCM OCOiO 
 CO ON CM CM O 
 OnCO^ ^ Tj- 
 CM vOO->4-00 
 
 K 00 o '-H cm' 
 
 i-H^CMCMCM 
 
 OOn Tt* »— I t^ 
 00 '-H lO CM "^ 
 
 ON r^ vo CO CM 
 
 vOi-HOOVO VO 
 coco On 0\ 00 
 
 r^coooTf r-i 
 
 CTnOOOn'^CM 
 CM i^ CM CO Tl- 
 
 CMCMCOt-h T-i 
 
 ^s. t^ CO COLO 
 
 ON"^ CO OTf 
 On OCM T-( CO 
 CM ON CO CM CM 
 
 CO t^rt lO 0\ 
 
 O VOcoOt^ 
 
 CMcouSr^cd 
 
 CO CO CO CO CO 
 
 CM CO 
 
 VOO 
 
 OCO 
 
 lOOOCM 
 
 t^CM VO 
 
 »-HlO O 
 
 oo-^ 
 
 iCMCOrJ^ 
 
 OWO'-HlOTj* 
 
 CO On CO Tj- CM 
 CMOOOOCM- 
 OOOOcOfH 
 Ot^-^LOTj- 
 
 oooooor^vo 
 t^ vot^ o»o 
 T-j CM CO lo vq 
 tovdt>Ioc)ON 
 
 tJ-On 
 On CO 
 
 ^^ 
 
 CM ^ 
 OOO 
 CJCM 
 
 T-HCOCO 
 
 t^o»o 
 
 CO CO CM 
 OTfco 
 
 r-(lOlO 
 
 LO VO ON 
 
 CMiOO 
 
 CMTtr>. 
 
 corj^io 
 
 VO.-IVOC0 00 
 coCMiOVOt^ 
 
 ONr^ VO "^lo 
 
 Tft^QCO VO 
 
 ■^ VO 'O VO T-1 
 
 OOOOO'^T^ 
 On CM VO On CO 
 vd 00 ON O CM* 
 ,-1 ,-H ,-• CNJ CM 
 
 ONOOOor>. 
 
 T-i COCM C7NCO 
 '-I On vOtT VO 
 •-"OOCMio T-i 
 VO CO On VOO 
 ^-H VOlo O •-< 
 O T- 1 u-j CM '— ' 
 t^y-nnCDm 
 
 CO lo vo' 00 On 
 CM CM CM CM CM 
 
 lOONOOt^tN. 
 
 T- 1 vocoi^ VO 
 C?NOnCM CTnCM 
 
 t^ O Ot^ CO 
 CM t^ Tl- ro VD 
 
 O LO '-I Tn. CO 
 
 »-J (Vi r!^ LO t< 
 CO CO CO CO CO 
 
 00 COCOON r-iC3N 
 
 CO C?N Ov "-I '-' VO 
 
 irjco VO O -^ On '-t 
 VO CMOVOloOncoco 
 
 ©^ CM On CMloOnOOco 
 
 vc< roLOO (MOnCMCMON 
 
 kJs, l-HTl-ON lOCMCMCOLO 
 
 OOO riCMco^iO 
 
 JcMfO-^ irjvdt<odO\ 
 
 1>.OncoOlo 
 vOTfTfvoO 
 
 1-HCMr-H On(N 
 
 <MVO'-iCM00 
 t^ CM CM 00 CO 
 CM cOt-( VO O 
 
 O VO "Tf COLO 
 
 t>. 0C3 O CM ^ 
 Cz5'-< corfLfi 
 
 00"^OnCMVO 
 t^ 00 CO l^ CO 
 
 r^ ONLOLo VO 
 
 CO VOLOt^ y-t 
 T-H CO CO CO t^ 
 CMCM t-i On VO 
 00 COO CO On 
 VOOnCM Tft-^ 
 
 CiS'-i'^Tl-O 
 
 i-H T-H On vooo 
 r^ CM On CO O 
 VOCM t^Tj-CM 
 
 VO LO LO 1— I LO 
 
 CO Of^LO CO 
 CM t^ CO CM CO 
 
 T-H Tf OOCM VO 
 
 coTfiot<od 
 
 CM CM CM CM CM 
 
 '-Hvoor^to 
 
 NO OnlovOOO 
 CO 00 00 OOO 
 
 CM voiN.r^ o 
 
 O On vo-^t^ 
 CO CO VO '-^ 00 
 
 VO'-iOOCOCJN 
 
 CqiOONTj-ON 
 
 C> t-J CM -^ LO 
 CO CO CO CO CO 
 
 tOiO 
 
 CM ON 
 
 VO VO 
 
 iHvovo 
 
 Sjt^LO 
 
 Scot^ 
 
 CO"* 
 
 ^<N 
 
 0"<^CMC7nO 
 
 CM^VOO(M 
 
 CM-^r^oo^t 
 r^ LOCO 001^ 
 
 LO^OOCO CO 
 
 vooooooco 
 
 CM ONVOlo VO 
 ^t-hCMCO-^ 
 irjvdKodON 
 
 t>sOCM"*00 
 
 CO CM Tf On 00 
 
 NO t^ »— I lO ON 
 
 VO CO VO '-I t^ 
 VO On CO 1— I CO 
 '-I CO O '-I ^ 
 00 '-H VOCM On 
 
 LOt^ COO '-H 
 O '-H cm' "^ LO 
 
 CO CM "OCO CO 
 VO 00 COLO On 
 rt- coco T-t 00 
 
 CO NOLO CJN VO 
 COr-HO'-Hr^ 
 VO t-H r-H VO VO 
 00 ON^ -^ ON 
 
 COLO 00 OCM 
 
 vdt<odo r-i 
 
 ^^^CMCM 
 
 Tj-txt^toco 
 
 OOlooO vo^ 
 t^ ^l^ VO oo 
 On O O CO O 
 CMLo cor^oo 
 
 VO -^ TfLO CO 
 
 LO 00 1— 1 -^ t^ 
 CM COLO vdr< 
 
 CM CM CM CM CM 
 
 LOOO cOTl- VO 
 
 cocMr^oo^N, 
 
 "^VO 00 CO CO 
 
 LO c:a o CMo 
 
 COONCO t^ On 
 T-HTt00<Nvo 
 OnO'-I cotJ^ 
 CM CO CO CO CO 
 
 o 
 
 ♦rjcovo 
 poo 
 
 !CMcO"^ 
 
 ,-HVO'-H vot^ 
 OOCMiOCM 
 
 LO LO LO Ot^ 
 
 o i-H cor^cM 
 
 O OLO vOlo 
 .-H CM COLO 00 
 OLO'— 100 VO 
 .-I 1-1 CM CM CO 
 
 io\dt>^odoN 
 
 r^^^^T^cM 
 
 LO VO O O CO 
 CMr^coCOr-l 
 i-H coo CM CM 
 CM COLO CO -^ 
 CM VOC^l ONt^ 
 
 vovooootj- 
 
 rJ-LOVOOOC^ 
 C5 ^' CM CO Tf 
 
 m 'Tt r-cin o 
 lotj-cox^lo 
 
 On VO -^ "^ On 
 00 00 -^t^ 00 
 VOX^O T}-0 
 Onlo CO '— < '— < 
 OCM "^^00 
 
 vdt<oc)ONC) 
 
 *-H ,-H t-4 T-4 CM 
 
 OCO 00 COLO 
 
 CTnO OnOOCO 
 
 CO -^ LO T— I -rf 
 
 O ONOOO VO 
 
 O '— I LO CO Tf 
 
 CTnOn^voco 
 
 l-H COt^ T-Hf^ 
 
 pCMTf 1-xOn 
 CM corfLOvd 
 CM CM CM CM CM 
 
 OO^Onvo 
 lOLO CO vO VO 
 On T-Ht^ VO l^ 
 On CO 00 On 00 
 
 '-• vocooco 
 
 COLO O On O 
 ■^CMCM CMiO 
 
 CM LO 00 r-H Tj- 
 
 OCJOnOCM CO 
 CM CM CO CO CO 
 
 O 
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 coo 
 
 P4 
 
 iCMcOTj" iOVOtxOOO\ O'-HCNjcOrf »ovOt>.00ON O >-< CM CO -^ lOVOt-^OOON 
 ^^r-i^^ ^^^^^ CMCMCMCMCM CM CM CM CM 04 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 345 
 
 t^og CM o CO 
 
 CMOOTfCM 
 O OlOiO I— 1 
 
 OnO'-; CO vo 
 <ri vd 00 o cvi 
 
 TfCOTfTfVO 
 
 ■ VOO 
 
 t^ CV) t^ ^O C7\ 
 
 Tj-VOO\' 
 
 CM "^On eg On 
 cx) '-I CO t^ eg 
 rgoforgoo 
 ONCotN.cgt^ 
 
 Ttt^'-<O00 
 
 ID CO CO o o 
 cor^ t^ fo CO 
 U-) t-H o org 
 to vo 00 00 CO 
 CN[r^o\Ocg 
 
 O CO CO vOiO 
 
 rro CO vqu-j 
 r< o eg' lo 00 
 
 \OcOOfO On 
 ,-. Tl- CO Ti- 0\ 
 
 CO CO 00 00 r^ 
 
 »-H ocoioo 
 
 vO-^I^ On ^ 
 
 ,— (lO VOlO CO 
 
 lOiO VOCO '— • 
 
 »-<' Tt r< o "^ 
 
 00 CO CO On ON 
 
 0\vomt>.^ 
 
 Tt-CM CO cOr-H 
 coOnioco^ 
 '^O^OOTt 
 OOio On^-h 00 
 ■^looN^cg 
 t~>; LTJ lo On u-j 
 On^coiOOO 
 
 lOLOlO 
 
 o voio 
 t^cgoN 
 
 ON^-t vo 
 
 cgr^io 
 
 oorgoo 
 oocot^ 
 00 CO eg 
 -^odvd 
 
 '-I'^OO 
 
 eg eg eg 
 
 0000 Tj- 
 
 e^j ON o 
 
 coco Tf 
 
 into vo 
 
 eg^-^ vo 
 
 '^^ 00 
 
 lovo -^ 
 
 ^ vo lO 
 
 On in! eg 
 
 egt^ CO 
 
 coco "«}• 
 
 eg vovooo CO 
 QTtege^ivo 
 •^t^ egioio 
 
 VOlO »-" T-H t^ 
 
 eg voonoon 
 lo Tj-t>^ VO On 
 OntT cofNU-) 
 
 »-< ^ r-i ^ og 
 
 eg* rf vo" 00 o 
 
 OO-^vOiOTj- 
 
 ovoococo 
 
 lOOOlOt^CO 
 
 eg ^ cor^t^ 
 
 00 vOTfcoiO 
 O On t^io Tj- 
 On VO ONr^ O 
 
 COlOtNO-^ 
 
 eg" Tt^ vd On 1-H* 
 
 lOlOliOlO vo 
 
 Tj- 1-H CM »-l T-H 
 
 CM eg ON CM VO 
 
 vo lO ITi »— ' .-< 
 t^ NO -"^LO Tf 
 
 1— I CO CO CO ^ 
 VO'-H i-nr^O 
 OOCM 1— iio vo 
 
 t^ eg t^ CM CO 
 
 CO vd 00 ^* CO 
 VOVO votNtN. 
 
 lOCOrfvo vo 
 O-^co VOCM 
 
 voegoO'-H^ 
 O vOiotN. ,— t 
 iJ^CM CM OOiO 
 CMrt-r^CM CM 
 
 egrt egt^oo 
 locM ooqtN. 
 
 vd On CM* Tf t< 
 l^t^COOOOO 
 
 vOOco 
 r^vo On 
 
 i-iCOco 
 vOOOtI- 
 
 IT) VO"^ 
 
 tN VO'"^ 
 Ovdrf 
 ONOCM 
 
 t^OO 
 
 On^ 
 lO vo 
 
 eg CO 
 com 
 
 vOt^tN 
 
 cor^io 
 
 lOOOOO 
 covo CO 
 t^m On 
 r^r^CM 
 
 vo r-lCO 
 CO r-l '-H 
 
 ^*ONcd 
 
 OV-HlO 
 
 ^egeg 
 
 lo^ eg 
 
 eg CO o 
 
 .-H vo lO 
 
 ooeg vo 
 
 OntJ- Tf 
 
 tNiO 00 
 
 "Tt CO vd 
 
 ooeg vo 
 
 CM CO CO 
 
 '-hON'-'OO 
 CMt^ voeg vo 
 
 OnO OnO >— • 
 tN.Tj-CMt^O 
 
 o^O^ooo 
 
 00 ON t^'-' CO 
 
 vot^eg T-( ro 
 
 lOCOCM ^ O 
 
 cdeg-^vdod 
 
 TJ- Ti- rt tT '^ 
 
 ^oc:^coeg^-^ 
 
 VOr-HlOVO-^ 
 
 t^r^n-ONOO 
 
 t^ voioco CO 
 
 Tfcoevj oncm 
 
 •^ Tf Tj- Ti- 1^ 
 On On CO '-I CO 
 OnOnOt-hCM 
 ON^rf vdod 
 rJ-LTjiOiOiO 
 
 ooTfot^^eg 
 
 '-HOOcot^T-H 
 COCM cot^t^ 
 COCMCM VOIO 
 
 ONoeg Tt-vo 
 
 t-hOCMOnCM 
 
 o »-• voloo 
 
 TfVOOO^iO 
 
 CD eg T}^ f< ON 
 
 vo vo vo vo vo 
 
 tNfNVOI^vo 
 CMT^t^egvo 
 
 O-^ioOnCTn 
 ^-1 vot^ '—I 00 
 t^irj T-iioio 
 CM OtN coo 
 On CO '—I to Tl- 
 00 COOO COC7N 
 
 T-HTtvdON^ 
 
 t>»tNt>»t^OO 
 
 to to eg .-«Tj- 
 
 Tj- vo Tj- Tt T-H 
 
 1^ coOnio»-i 
 O CO coto »-i 
 Tj-Loio »-H On 
 
 C3n vo i-H vo tN. 
 
 t^ oo»oegt>x 
 
 loto O '— ' On 
 
 ""^ 0C5 rf ,-; ON 
 00 ON'-' CO Tj- 
 
 VOOtN 
 t^OO Os 
 CMt^OO 
 tNto CO 
 
 tN<7NC?N 
 '-H .-H CO 
 ONX>»Tt 
 
 OCOON 
 t^ON^ 
 
 ^^eg 
 
 CMOO »-• 
 
 cor^ ctn 
 
 vo O vo 
 
 loto O 
 
 VOON CO 
 
 vo'51- eg 
 
 VOOO CO 
 
 r-HO eg 
 
 t<od CM 
 
 eg CM CO 
 
 ONCMiOVOI^ 
 
 eg-^xoocM 
 
 O OOncOvo 
 toto ON^ ^ 
 
 ^ ON'-i T^^ 
 r^cnegTi-r^ 
 
 i-H Oi '— I vo CM 
 O NO Tf; ^_ ON 
 CJn O cm' rt vo 
 
 OnOnvovovO 
 I^Ti-t^vOO 
 0\ ONVOCOCM 
 CO CM CO CM VO 
 
 CX) '-I vo VO ON 
 
 OVOcocovO 
 CO vo CO CO vo 
 !>. to T^ CO CM 
 tv! CJN 1-h' CO vo 
 
 ^Ttmvovo 
 
 cDr^Tt•oo^^ 
 o\eg vot^ vo 
 
 cOi— I VOCM CO 
 CO CO VOCM vo 
 
 ^r^ COVO '-I 
 
 Tt vo CM rj- CO 
 CO cot^ rf vo 
 
 eg CM CNi CO Tj- 
 tN On '-h' CO vo 
 
 lOio vo vo vo 
 
 VOOOtNVOOO 
 
 OOOCOCM On 
 coONVOTfCM 
 00 vo CO 00 00 
 
 vo vor^r^ CO 
 
 00 '-H eg eg eg 
 
 OnOOOVOVO 
 
 vor^ocM vo 
 
 l<ONCM'<^vd 
 vo vo t>. t>. t>. 
 
 CJOCTnOOOVO 
 
 vovooot^eg 
 
 TfCM VOCOOO 
 
 eg vo r-. ,-ito 
 
 CM '-hCM vot^ 
 CMOVOOOO 
 O CO t^ CO CO 
 
 cjNeg vq coco 
 
 00 '-< Tf CJnvo 
 
 t>.a\o»-"co 
 
 '-'Tfvooovo On 
 
 QCMt^T-H ON 00 
 
 voegt^ ^ 00 vo 
 
 Oooegvo-H t^ 
 
 eg COON Tj- Q '-" 
 
 ^ ~ - vo •^ vo 
 
 t^ On CO " 
 
 tv. tv. vo ,-j 00 tN. 
 
 CM ^-ICMiOOv vd 
 
 lOtNOi^co vo 
 
 ^r-i,-.(Meg csi 
 
 t^ On '-t CO CM 
 CO voO CO VO 
 
 00 vo 00 '-'ON 
 
 vor^eg VOO 
 
 CO '-'00 00 CO 
 COOCO Onco 
 to,-; vqCM On 
 t< C?nOCM CO 
 COCO-<*'<f^ 
 
 ONr^'^OOvO 
 
 ooegt^co vo 
 
 tN. ONOO voco 
 
 oovoooooo 
 
 OC7n,-i00V0 
 CM vovo OnO 
 
 ON r^ 00 T-" 00 
 VOCM On t^-^ 
 
 vot<odoe4 
 
 Tf^Tj-VOVO 
 
 i-^egQCMTj- 
 
 0\C0O'-i On 
 coCM >— I OOt^ 
 
 On "-i-^ COVO 
 00 On '-I On 00 
 t^ '-I co^ 00 
 
 VO 00 CM On 00 
 
 CMo or^ o 
 
 Tt vd K On »-< 
 lOlOVOVO VO 
 
 vo 00 00 On 00 
 C?N On r-i CMvo 
 
 OCOOONt^ 
 
 O'-i'-^'-'ON 
 
 CMtI-OnCM vo 
 tJ-00t-«vo00 
 1—1 vovo VOO 
 VO vovovo VO 
 
 CO lots! o\.-< 
 vovovovot^ 
 
 TfCO'-llOlO 
 
 O ONt^'— I On 
 oooO'-iegcM 
 eg CTwotN. vo 
 
 OOvovot^lN. 
 
 vovo eg 00 CO 
 coThvdodeg 
 t^oooNOeg 
 
 *OtN,-( 
 
 VO'«!l-lO 
 OCMvo 
 00 VOCM 
 t^OOCM 
 CMOvo 
 tN'-i VO 
 
 ONt^VO 
 
 vdCM On 
 covo vo 
 
 OOVO O 
 
 cotJ- CO 
 
 8 CM CO 
 
 On^ O 
 
 ON vo CO 
 
 CMO O 
 
 o\vo 00 
 
 ^s!^s; 00 
 
 oeg coiovoooo 
 
 '-"-' ,-1 ,-1 T-c ,-. CM 
 
 OVOC^nO"* 
 CO '-I VOCM CO 
 OOCM O^co 
 vOOOrft^O 
 O VO""^ vo CO 
 OnOOOOvO 
 CM OOvocOTl- 
 i-t voOvOO 
 
 COOCMCO^ 
 
 VO voco"^eg 
 O* vo c?\ CM On 
 VOO-^TJ-CM 
 00 vo'rj- OnCM 
 
 o vooveg VO 
 
 t^ -— 't^ vo vo 
 vo r-H vo CM 00 
 
 covovdcd o\ 
 
 "* "* Tf Tj- Tj- 
 
 00TfiO»-i|^ 
 
 OvoCMOOO 
 
 t^VO'-'OO vo 
 
 votN T^o CO 
 
 VO'-' CO CO CO 
 CDNCor^CMOO 
 OOco C?NOOOO 
 
 1-1 CO "vt- vd 00 
 lovomiovo 
 
 00 '-I 00*^0 
 
 oeg'-^egr-H 
 
 >— I tN to 00 CO 
 ONCO'^OOtJ- 
 VOVOtJ- cot^ 
 VOTf- VOOOCO 
 
 •-"vocoeg T^ 
 ONvqTtcM lO 
 On '-I CO vo t< 
 vovo vovo vo 
 
 On eg vovovo 
 ciOvoi^CMrN 
 ONvorwor^ 
 
 ooiooegoN 
 
 t>.TfVOT-l o\ 
 
 T-' CM Tt r^ '-' 
 ooe^irNtNt^ 
 
 00 Tf to CO 00 
 
 odododcKo 
 vorNOOONT-' 
 
 Tj-VOOCM'-I Q 
 
 TfCM '— 1 NOVO O 
 
 vovocot^ ^ eg 
 
 O0C3N VOO CO ■^ 
 
 TttN'-Hoeg CO 
 
 COOOOOvovo CM 
 
 O'-'VOOOO t^ 
 
 »-"-" ONtNCO O 
 
 fo' vd cjn Tt^ CD i< 
 
 cgcoTfvooo ON 
 
 COiOVOCOCNJ 
 
 VOtJ-COvO vo 
 
 '—or^oooo 
 
 OntJ- VOO On 
 
 00 r^ OOVO 
 Ti-eg^j-ONt^ 
 
 00 CO On vovo 
 
 1^ '-< Tf 00 eg 
 TtvdtvIodcD 
 
 CO CO CO CO rt 
 
 O VO'?t '-•vo 
 VO CO'^ VOOO 
 voOOtN CO O 
 
 t^r^Ti-cM vo 
 
 CMOOVOt^CM 
 Qvor^CM CM 
 vOt^O vo ^ 
 VO OvoOntJ- 
 
 vOOnVOvOio 
 coOrfcO'-i 
 cot^ ONONt^ 
 
 t>^ cooot^ vo 
 CO eg ovt^r^ 
 
 NOVO CO tN '—I 
 OOt^t^ Onco 
 
 oocooococdn 
 oc5c3'-<cot^ 
 
 •^ to vovovo 
 
 CMt^CMt^vo 
 
 tN.-^cotNOO 
 
 Tj-VOTtfN CO 
 
 tNOOTtOco 
 OOOco VOOO 
 »— ' vo VO CM Tt 
 
 00 Tj- eg eg CO 
 Ti-o voeg 00 
 vd 00 ON '-h' eg* 
 lOvo vo vo vo 
 
 00 vovo CM -^ 
 
 '-'CO 00 00 00 
 CMtNCTNOOvO 
 OOvoVOTj-co 
 T-H Tj- VOVOco 
 CO CM On VOVO 
 vovovocot^ 
 
 Tj;oqvqoNvq 
 
 VOt^OOONO 
 
 M-c^vovO'-i Th 
 
 OOrN^-^O On 
 
 VO'-<tNtNVO CM 
 
 rJ-CM On vovo 00 
 
 oovocJNegr^ co 
 
 CMt-iOOCOCO '-< 
 
 '-it^tN^ vo 00 
 
 OnvOOnOOco Tf 
 
 o''-^'CM'^t< CD 
 
 T-'egcoTj-vo *^ 
 
 O'-'CgcOTf lOVOt^OOON O'-iCMCO'^ iOVOtN,OOON OiOOiOO lOOi'^OiO Q 
 cocococOCQ COCOCOCOCO rj-"^'*"^"^ ■^ Tl- Tt Tt Tj" mvovovOt>. 1>»0000OnO\ o 
 
346 
 
 TABLES 
 
 
 o 
 
 w 
 
 Oh 
 
 W 
 u 
 
 < 
 W 
 
 o 
 
 H ^ 
 
 O 
 
 W 
 ►J 
 
 H 
 
 l-H 
 
 o 
 
 12; 
 o 
 
 < 
 
 o 
 
 00 
 CO 
 000 
 
 
 
 
 VO-^lOi-HOO 
 
 TfrJ-Ot^CO 
 
 OOOOvOioO 
 
 OOO 00 On ii-> 
 
 OCMOOCMCM 
 
 O f~x NO NO CO 
 
 
 
 
 CM oot^r^io 
 
 OnvoCMVo On 
 
 ooot>»u->t^ 
 
 CM NO CM NO CO 
 
 
 
 VO 
 
 Tf CM 1— it^io 
 
 On 00 On eg T^ 
 
 1— iNo pf^r^ 
 
 C?NCM 0\CMt^ 
 
 
 
 
 
 0\^ rovo I— 1 
 
 ONTi-TtCOVO 
 
 VOCMt^lOON 
 
 ^OOVO^^ 
 
 
 
 ^§ 
 
 ocooc^co 
 
 t^voONi-iO 
 
 OnioOOVOON 
 
 vot^CMOom 
 
 lOCO t^ T-H t^ 
 
 
 ^ 
 
 l»>»ti-}COX^ r-H 
 
 O i-i OnCMio 
 
 lOCMCMiOON 
 
 mcMCMiom 
 
 "ifvOiOOOCTN 
 vOto OCMco 
 
 
 vOCOt-^ 
 
 CO t^ Oi On CT\ 
 
 oor^vooO'— 1 
 
 ^>.t^ 1— 1 o^o 
 
 OOOnOnOni-h 
 
 
 VO 
 
 O'-i CO 
 
 vOONCOOqrl; 
 
 i-iONOOOOO 
 
 CMVOCMONt^ 
 
 iv. ON CO On 00 
 
 OOi-nr^lOVO 
 
 
 
 '-^CvJcOTt 
 
 irj vd 00 cK »-5 
 
 corf vdoc5 1-5 
 
 £PifiaJoco 
 
 vd ON CO vd o 
 
 Tf oncoocJco 
 
 
 
 
 T— t 
 
 ,_(^,_,,_iCM 
 
 CM CM CM CO CO 
 
 COCOTf Tf lO 
 
 ir>ii-}NOVot^ 
 
 
 
 
 lO l-H to 00 CM 
 
 rJ-VOCMiOON 
 
 ONl^VOtN.r-* 
 
 OT-iOcMr>. 
 
 CM NO u-> tN. T-( 
 
 
 
 
 CgoOrl-OOCO 
 
 lO »—<io 00 On 
 
 ir)tN.covoON 
 
 i-<00^-hOO 
 
 OOl^Tf t^ON 
 
 00 CO VOCM T-H 
 
 
 
 ID 
 
 CO-HOO^ 
 
 CMt^VOCMi-1 
 
 COi-iVOtJ-co 
 
 rfi^irfioSo 
 
 
 
 oq 
 
 0\ 00 CM 00 CO 
 
 voONVOOOQ 
 
 lOlO'-'t^ON 
 
 OnioCM 00 1— " 
 
 
 
 irji— 1 
 
 VOONO^IO 
 
 OOt^i-JoNVO 
 
 mrJ-cocoO 
 
 On CM CM Tf ON 
 
 OTf ^lOt^ 
 
 
 ^ 
 
 CMO 
 
 u-)-hCMO\vO 
 
 
 OOf^OCMON 
 
 mo\"^pT-H 
 NOt-h OcOO 
 
 t^ CO On CM CM 
 
 
 ir)io.-i 
 
 ^?^^o 
 
 t->, o 1— < I—" On 
 
 t>slOTt-COCO 
 
 CM 1-H NOOCM 
 t^-HVO^co 
 
 
 lO 
 
 O'-' CO 
 
 lOCM ONtVjlO 
 
 novo 00 1-1 in 
 
 pi>.LOT4-U-) 
 
 
 
 i-J cm' CO Tl^ 
 
 irjvd odes'-" 
 
 CM Tt lo I< C> 
 
 ,-5coioodo 
 
 CM CM CM CM CO 
 
 COCOCO^r^ 
 
 t< ^' Tf 00 CnJ 
 
 
 
 
 
 »— < »— 1 1-H 1— < T—t 
 
 '«f lOlOlDNO 
 
 
 
 CO 
 
 CO VO On CM CO 
 
 CO r^ CO cvi CO 
 
 ^^^^^ 
 
 t^omvoi-i 
 
 ITJOi-Hl^NO 
 
 
 
 
 t^vot^ VOCM 
 
 t^ 00 ON On CO 
 
 
 
 
 if^? 
 
 0\ .-C T-^ CO T}- 
 
 CDnOO-hCOOn 
 
 Tf NOVO CO CM 
 
 CM NO l^ On NO 
 
 OTf cococo 
 
 
 
 CM 0^ 
 
 O OMO »— • 1— 1 
 
 or^ cor^o 
 
 in CO o 00 VO 
 
 CM CO IN. CM On 
 
 T-H Tf (NJ CO CO 
 
 
 
 O^ 
 
 t^OO 1-1 O '-I 
 O voOnOCM 
 
 OO ^ ^ONCM 
 
 o cor^oio 
 
 Tf t^COOt-h 
 
 CM NO CO coo 
 
 
 ^ 
 
 lot^oo 
 
 Tt CDNi-HlOCO 
 
 T-H coco t^ On 
 
 lOOi-HCOco 
 
 
 Tj-cor^ 
 
 ts^^^OOO 
 
 00 ''^ NO "^ CO 
 
 COt^tJ-iovO 
 
 r^ooocooo 
 
 NO t^ ^ On CM 
 
 
 ^ 
 
 O^C<l 
 
 Tfr^ocooo 
 
 CM 00 Tj- 1-; 0\ 
 
 i^t^i>.ooo 
 
 CO r^ CO On NO 
 
 mior^ OvTf 
 
 
 ^ 
 
 ,-H'OJcOTf 
 
 lo vd 00 ON o 
 
 CM* CO lO l^ 0(5 
 
 O CM T*^ vd ON 
 
 t-h' CO vd 00 ^ 
 
 Tf t<o cor< 
 
 
 
 
 
 
 CM CM CM CM CM 
 
 CO coco CO Tf 
 
 Tf Tf lOVOlO 
 
 
 
 
 VOVOOOVO'-I 
 
 CM^VOOOCJn 
 
 Tf tJ-CTnOOO 
 NO T-H CO 00 Tj- 
 
 00CMC3N00CM 
 
 OnCMOOOO 
 
 
 
 
 \0'<:^r^(Nco 
 
 T-H rf Tf VO T-H 
 
 iorN.t^iOT-H 
 
 CM NO Tf On CO 
 
 
 
 Th 
 
 CMu-j TJ- \OiO 
 
 tN. ,— ItOt^ 1-1 
 
 t^ T-H CM CM On 
 00 CO T-H ^ CM 
 
 
 
 
 
 CM i^ On (N ON 
 
 OvOOCOt-( 
 
 r>> o NO 00 o 
 
 O^^OO^ 
 
 
 
 VOrJ- 
 
 CO On C^J C^l r^ 
 
 ^co 00 00 On 
 
 lomm "^ CM 
 
 OCMO^OOVO 
 
 ON r^ CM to CM 
 
 
 ^ 
 
 
 VOCMOOn-CM 
 
 vovoiovo ^ 
 
 CO Tt l^ in i-H 
 
 CO o\t^r^CM 
 
 lO T-H Ttt^ NO 
 
 
 T^c^JT^ 
 
 I-' CO On '-H 00 
 
 O OOCM CM CJn 
 
 CM CM On-* tN. 
 
 t^ NO Tf-H 00 
 
 Tf ^00 NO NO 
 
 
 "^ 
 
 Or-i(Nl 
 
 rf VO 00 CM lO 
 
 cz5Ti-pvqcM 
 
 poovqvovo 
 
 t>. On CM NO p 
 
 vOcoOCTnO* 
 
 
 
 i-n'oicO"^ 
 
 ir> vd (< On O 
 
 CM coiovdod 
 
 Oi-I co'iot^ 
 
 On'i-h" Tf Nd On 
 
 T-I Tf K CTs cm' 
 TfTf Tf TflO 
 
 
 
 
 
 1— 1 1— 1 »— < 1— 1 »— 1 
 
 CMCMCMCMC<I 
 
 CM CO CO CO CO 
 
 
 
 00 
 
 OOOOr-lt^T-l 
 
 VOCM"^OVO 
 
 ooi-iiooo 
 
 T-H 00 lO CO T-H 
 
 OOVOT-Ht^C^ 
 
 CTvOOTf Tf O 
 
 
 
 00 
 
 OO^intr^OO 
 
 ^Os^roco 
 
 oor-st^coio 
 
 NO VOCM coco 
 
 
 
 in CM 
 
 loCMt^^io 
 
 
 O OMO i-H o 
 
 
 VO I—* O ^^ On 
 
 
 
 CM-^ 
 
 VOiOOCOON 
 CMOOn^OO 
 
 On On VO CO 00 
 
 00 <M T-H ON 00 
 
 00 t~x O I—* CM 
 
 ioonocmon 
 
 
 
 C^On 
 
 COONC3NOON 
 
 VOOOVO^ 
 
 VOTf ONTf to 
 
 oot-i o Not^x 
 
 
 
 lOVOTj- 
 
 
 to T-H U-) On t^ 
 
 
 C3^COO^OO 
 
 
 COO'-' 
 
 NOlOt^lONO 
 
 COTtOT-lt^ 
 
 t^^VO^NO 
 
 On r^ o ONin 
 
 t~>» VO CM VO VO 
 
 Tf T-ltOONi-H 
 
 
 .Ot=;(M 
 
 coiot^oco 
 
 CMONt^TfCO 
 
 CMCMcOTf VO 
 
 CACOt^ CMO* 
 
 
 CO 
 
 '-'Cvico'^ 
 
 »i-Jvdx<ONO 
 
 1-1 CO Tj^ vd r>I 
 
 0\ p CM Tf Nd 
 
 00 O CM Tf vd 
 
 O6y-^rri\oc6 
 
 
 
 
 T-H 
 
 
 1-hCMCMCMCM 
 
 CM CO CO CO CO 
 
 COTf Tf Tf Tf 
 
 
 
 
 1-1 00 00 in CO 
 
 i-< OnVOiovo 
 
 ONOrfr^Tt- 
 
 OnCNOOCM 
 
 CM to CM CMO 
 
 
 
 
 OOOO-HO^ 
 
 CONOIO-^T-. 
 
 00 CO t^ CO "^ 
 
 Tf r^fot^cs) 
 
 CO CM to >0 CM 
 
 
 
 t^ 
 
 lO On CM VO NO 
 
 ONloONOT:^ 
 
 CO >— 1 t^lO 00 
 
 Tf lOOCOO 
 
 Tf CM CO CMO 
 
 
 
 CM 
 
 coovocoo 
 
 t^ OnCM C^nCM 
 
 T-H 00 00 CO NO 
 
 t^ 00 00 00 t^ 
 
 NOTf CO CMtO 
 
 
 ^ 
 
 
 
 00 t^ O t^ CO 
 
 ONOOlOTfOO 
 
 coTf r^ooTf 
 
 S^^^8§8 
 
 
 O CO 
 
 ON 00 CM CM On 
 
 cOt^CMtv.vo 
 
 OOVO^rf ^O 
 
 OVO VOCM VO 
 
 
 CO 
 
 CO 0\ 00 
 
 ONOVO Onu^ 
 
 VOO CTn^OO 
 
 ONIONO^T-* 
 
 t^t^coioCM 
 
 lO too CO T-H 
 
 
 O O '"' 
 
 coTf vqoO'-^ 
 
 Tj;oOi-^VOO 
 
 lO T-H t>^ Tj- T-H 
 
 oqvqioTf Tf 
 
 Tf lO tN. C?N CM 
 
 
 
 '-^CqCOTl- 
 
 lO NO ts! 00 o 
 
 1-1 CM "^ lO t< 
 
 oc) o T-H* CO lo 
 
 vdodocMTf 
 
 vd OO' O CM to 
 
 
 
 
 
 
 1-1 CM CM CM CM 
 
 CM CM CO CO CO 
 
 COCOTf Tf Tf 
 
 
 
 lOO 
 
 voovoioo 
 o-^r^CMoo 
 
 cmijooni^ c^ 
 
 CMOOCMI^Q 
 
 lOTf OnOOvO 
 
 OCOIO-hON 
 
 OCMt^CMTf 
 
 
 
 <M00 
 
 OOOOCMOco 
 
 mCA^ CM On 
 
 T-HONVOTf CM 
 
 
 
 VO^O 
 
 
 ■^ VOt^ T— NO 
 
 §^§8^^ 
 
 1-^ U-) NO On T-i 
 
 OOOOTf to(M 
 
 
 
 lO-^ 
 
 VO-^OcOi-i 
 
 VO l-H CO (Moo 
 
 OnCnJ nOt-h (M 
 
 Tf otOt^P 
 
 
 5S| 
 
 IDCM O 
 
 VO ONt^OOCM 
 
 CM Tf CM VO On 
 
 r^ cjNTfTfo 
 
 COCOIOONCM 
 
 
 
 r^rooo 
 
 CM t^ ''^ CO VO 
 
 ^cot^coco 
 
 lN.f^iO^ 00 
 
 oo^ooSon 
 
 
 CMOOVO 
 
 OOCVJQr-HlO 
 
 CM Tj- VOOOO 
 
 COrtONt^ON 
 CO VO ONCOt^ 
 
 NO VOO On CM 
 
 ON-HOOOVO 
 
 
 ^PO'-H^ 
 
 CM <^ CO 00 lO 
 
 T-H On NO lo CO 
 
 CM CM CVj CO -"^ 
 
 
 
 1-5 (M* CO ''I" 
 
 lO NO t< 00 o 
 
 1-1 CM CO lO MD 
 
 00 On ^" <N Tf 
 
 vdf^ONi-I CO 
 
 to x< On 1-H CO 
 
 
 
 
 
 
 i-H^CMCMCM 
 
 CM CM CM CO CO 
 
 COCOCOTf Tf 
 
 
 -a 
 
 l-H CM CO Tf 
 
 iovot^00 0\ 
 
 Oi-iCMCOtJ- 
 
 in NO tv. 00 ON 
 
 P i-HCMcOTf 
 CM CM CM CM CM 
 
 in^i>20S^ 
 
 
 .2 
 Ph 
 
 
 
 
 ,_, T-H r-l T-H ,-( 
 
 CM CM CM CM CM 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 347 
 
 CMOsfO — O 
 
 rsjVOVOOOro 
 
 CMNOt>.T^oo 
 
 0\CM OCMtO 
 
 COt^O vOto 
 
 t^tNCMOO'-^ 
 
 t^ 
 
 CNlcoOtv^vo 
 
 oovovor^T^ 
 
 On VO 00 10 00 
 
 votntoCM 00 
 
 tv. vo '— 1 OOto 
 
 totoCOtN vo 
 
 r^coTj-i— ivo 
 
 to 
 
 VOt^OOrr-^ 
 
 to co-<^t^^ 
 vooOTj-r^co 
 
 CO -^(M COO 
 
 rf VOOOON 
 
 On t— 1-1 r^ ON 
 
 CO 
 
 00 t^t^vO 10 
 
 t^NO'-H OlO 
 
 ^CM-HCMO 
 
 OCM OONONO 
 
 I>-ONTtOOTf 
 
 to 
 
 ^ vOI^t-t^ 
 
 ^000^^ 
 
 On ^ to 10 
 
 tOt— 1 VOtO -^ 
 
 
 Nooor^r-HCM 
 
 
 
 00 •-' On COCO 
 
 "-^t^otNoo 
 
 CO CO 00 Tf 00 
 
 tOCM^CM CM 
 
 OC ONT-HtOTj- 
 
 00 
 
 »0 00 rj- CO 
 
 COCM VOOLO 
 
 NOTttOOtO 
 
 Tf On voto 
 
 CO t^ CM CO CO 
 
 CO ^ -^, C7N 
 
 ^ONOOtNO 
 
 vo 
 
 OOOOOfO^ 
 
 Tf »-H CM On 
 
 tNOCTNtotN. 
 
 tN. to to On 
 
 On to ON ^ 
 
 CO 
 
 On Tj; IN.* Tj: 
 
 »-h' C>\ t< 10 10 
 
 Tttotot< On 
 
 CM* vd '-< vd CM 
 
 O*^ coc7\rN 
 
 ONONCO^NO 
 
 Q vd cvi ^ o\ 
 
 OTt-TfTl-O 
 
 CO 
 
 tN.00 0\0\O 
 
 r-t .-1 c\j CO T^ 
 
 tOVOtN.00O\ 
 
 <— < CM tT to tN. 
 
 
 ^ 
 
 
 T— ( »— 1 1— 1 r-l T-H 
 
 CM CM CM CM CM 
 
 CM cOtot>^C?N 
 
 CO tN CO '-CM 
 '-I »-H CM CO rf 
 
 ^ 
 
 oootN.r^oo 
 
 lOCMVOOON 
 
 Tftoo vO On 
 
 t^ votoT^ ON 
 
 CMCOOOOOt-h 
 
 ooTtc^ooCM 
 
 CO 
 
 1000 CO 00 CO 
 
 CO t^ 00 000 
 
 r^cM oovo CO 
 
 CNl ON '-H NO to 
 
 CO NO 00 ON to 
 
 r^ COOO '-'In. 
 
 rrco 00ONC3N 
 
 On 
 
 t^ONONOON 
 
 Tf CM -H 00 >0 
 
 to CO '— ' CM CM 
 
 to00tN.-HO 
 
 00 »-H 00000 
 
 NO 
 
 TtCOfMt^LO 
 
 0<Mcort(M 
 
 t^ votocoo 
 
 to vo CM On NO 
 
 a\T-ir—'^y-< 
 
 to 
 
 oor^ 00t>^ CN 
 
 CO CO '-H 100 
 
 o.r^i^ CO 
 
 l-H-HTJ-CONO 
 
 CjNNOt^OtO 
 
 t^OOOcotO 
 
 
 00000 fO^ 
 
 OCOONtO 
 
 ON CJN r-< CO CO 
 
 to On to NO 
 00 '-' CM CM 
 
 ^^S^8S 
 
 COOOt^t^CO 
 
 to 
 
 CO^ONVOg 
 
 CM coCvIOOn 
 
 Onco coONrJ• 
 
 vqcM pNONO 
 
 CM 
 
 CO 00 vq rN. 
 
 W 00 CM C3N -^ 
 
 t^ VO i-H "^ 
 
 CO r>. to ^>; to 
 
 
 
 vdotoo"S 
 vot>.r>»oooo 
 
 uS »-h' t< Tt^ 
 
 In." to CM '^ 
 
 ggggg 
 
 cK CM* CO vd 00 
 Ot^ to to CO 
 CM CM CO ri- to 
 
 vd '-h' to Tt CJ 
 
 cd 
 
 OnOnOO'-h 
 
 CM CM CO"*- to 
 
 to r^ rj- <7n Tl- 
 tx On CM too 
 
 NO 
 CV4 
 
 
 
 
 
 voa\'<*-oovo 
 
 000 CM r^ ON 
 
 VOO-^CMO 
 
 NOtrjOCM 
 
 cot^oorfcg 
 
 cor}- coo 
 
 00 00 00 NO to 
 
 CO Tt CM 00 
 
 t>. 
 
 voi^cg (N Tt 
 
 r-llO ^ VOCM 
 
 CM cOCTvONto 
 
 ONto^torf 
 
 CNl 
 
 On tv, U-) NO "O 
 
 00 10 Tl--^ CO 
 
 to CO CO '-itN 
 
 00 CTncoOOn 
 
 ^00 NO NO On 
 
 NO 
 
 NO '-/J ^ CNl !/-> 
 
 ro CM CM eg 
 
 ^NC^OCM 
 
 
 NO '-H CO OtO 
 
 CM to toco r^ 
 
 NOON COQtO 
 
 to 
 
 VOON coCM -^ 
 VOcO'-^OOtJ- 
 
 coNOt^^OO 
 
 OvCMNOC^NCO 
 
 OC7NC3NOOVO 
 
 CO vo CO OCM 
 
 CTn 
 
 I^ (VJ NO VO 
 
 O^TtNOCO 
 
 ONCOCM t^ ON 
 
 CO tN, t^tN On 
 
 Tft^CMOvrf 
 
 TftO CO NO 00 
 
 to 
 
 >0 ^ u-j CO 
 
 c^ NO"^coMD 
 
 co"^ CMtN --H 
 
 ooqoNCMC?N 
 
 rJ- ON t^ CO to 
 OOOVOtoOO 
 
 O'- ON CO NO 
 
 to 
 
 ot^^ot^ 
 
 ^-hO-^^ 
 
 to ON Tj- CM 00 
 
 to NO CvJ vo 
 
 00 
 
 —I -^ CO rg t< 
 
 1-h' vd '-H* vd —J 
 
 X< CM* 00 to r-I 
 
 covdco'-I cdn 
 
 00 tN." c?N vd .-h' 
 
 '-^' On rf to cvi 
 
 
 OOOOONC3NO 
 
 O'-"-'CMc0 
 
 COTftOVONO 
 
 t^ CM 00 NO NO 
 1-HCMCMCOTt- 
 
 00 CM '-'Tf CO 
 lOt^ON'->rl- 
 
 
 ^ 
 
 
 '^'~"~"^'~' 
 
 lOVOt^CM-H 
 
 voioovo T-H 
 
 ocoooovo 
 
 Tj-CM coTh On 
 
 VOC3NOtONO 
 
 CMiOtorJ-iO 
 
 t— 1 
 
 t^CM \OTj-io 
 
 CO 00"^ CM IN. 
 
 tN cot^ ^ On 
 
 
 NOC7NCMT^t^ 
 
 lOtN'rtiOTl- 
 
 
 tN,"-) OOt^ 00 
 
 rOco^ScMQ 
 0\f^ Tt-iOOs 
 
 TfcovOvOO. 
 
 to vor^ '-I NO 
 
 CM t~x NO T}* 
 
 coCMtoOOO 
 
 NO NO CO CO 00 
 
 ^ 
 
 CM'-"^cOTt 
 
 1-" coONOOt^ 
 
 On vo ONO CO 
 
 00 t^ 00 00 to 
 
 NCtNCM co^J- 
 
 Q 
 
 CM cr5CMCO-H 
 
 to to to CO 00 
 
 CO to CO CVJ t^ 
 
 0--VOCOT}- 
 
 COOn-hcovO 
 
 fv. 
 
 Tj-OO'-'ONt^ 
 
 CMOOCMOOn 
 
 to vo On CM CM 
 
 On Oto CO CO 
 
 t^ONQOCO 
 NO to On NC ON 
 
 ^ Tj-Oco^i- 
 
 CO 
 
 00 CN LO 
 
 u^ en i-N 
 
 CMCM—i — "-H 
 
 CM r^rt- vo CO 
 
 co rf 00 00 
 
 CM 
 
 Ocot^CMCO 
 
 NOlOt^ONTj- 
 
 qooocjoTj^ 
 
 p 00 ON CM 00 
 
 vq 1-1 ON On CM 
 
 NOCMOC^^x 
 
 NO 
 
 vd 0< CM vd 0^ 
 
 CO i< ^' 10' 
 
 tOCJNTf OtO 
 
 r-<" vd CM* On to 
 
 CM* »-H* ^s.■ Tt Tt 
 
 to On CO On NO 
 
 00 '-<' vd ^s! CM 
 
 I< 
 
 irjio VOVO vO 
 
 tN.rxoooooN 
 
 ONONO^J-" 
 
 CM CM coco Tt 
 
 ■^^tot^CM i-" 
 
 Ti- to NO 000 
 
 CO 
 
 CM 
 
 
 
 rHr-Hr-4 
 
 ^^^^^ 
 
 1-H »— 1 CM CM CO 
 
 00 oor^ioO 
 
 Tj-00O(M"<1- 
 
 to t^ CO 000 
 
 QtOtOONt^ 
 
 On tJ- to to to 
 
 ^OT^oooON 
 
 cotooo^io 
 
 NO 
 
 CNONTj-O'"^ 
 
 tN ^ cotN 
 
 tNTf CMCMCO 
 
 '—I 00 00 to to 
 
 00 00 rl- On 
 
 ONOrrt^to 
 
 NO 
 
 r^ocMOCM 
 
 CM CO On rj- NO 
 
 rN.J>^^ ONr-l 
 
 CM .-iCM VOto 
 
 OnCM VO^t- 
 
 NO 
 
 t^r^ "-I u-3 
 
 OvSoOOOCTN 
 
 I^ CO l^ CM CO 
 
 8167 
 8403 
 5097 
 8825 
 0184 
 
 
 r=.00ONCMr-H 
 
 to 
 
 vo-^iOCM -H 
 
 CVJ to CO vo CO 
 
 OtN coo 00 
 ONO tN to 
 
 NO 
 
 CM ON '"^-H CO 
 
 Tj-r^t-^00''^ 
 
 OOnI^OO 00 
 
 lN NO VOCM t^ 
 
 
 CM CM CO -^ 10 
 
 r^o>ocM CM 
 
 tOOOrJ-co 
 
 CTNTf^NO CO 
 
 COOVOOOO 
 
 T— 1 
 
 VOrl-cOcO'* 
 
 vOO^Ot>N 
 
 to to NO 00 CM 
 
 tNTf cocovq 
 
 CJNONtorN; ON 
 
 to CO CO CM t^ 
 
 NO 
 
 '-H* rf t< CO 
 
 lOLOlT) VOVO 
 
 vdocotvio 
 
 COOOONCAO 
 
 to to to 
 
 CD Q Nd 00* 0(5 
 CO vo ON CO 00 
 
 0(3 0\* CO* CO «-• 
 
 CM* 
 
 vot>.t^t^oo 
 
 ^ ^ CM (N) 
 
 TJ-^OOCM 
 
 NO 
 
 
 
 '— ' 
 
 
 1-Hr-H^CMCM 
 
 corfto vot^ 
 
 00 
 
 T-^ 00 CM 00 CM 
 
 '-ir^ONtNio 
 
 CO CO to rf ■r-> 
 
 c:^ coto ooto 
 
 OnCMOCM^J- 
 
 ONtOlOtOCh 
 
 
 
 I^^iOCM>0 
 
 00 CM to C^4 t^ 
 
 In. to Tf CO '—1 
 
 COCM O\C?n00 
 
 CMfNOO OOtN 
 
 to to NOVO NO 
 
 i< 
 
 ii-> 00 00^ VO 
 
 ^""^ CO On CO 
 
 Osr^NOCM On 
 
 T- 't^otor^ 
 
 VOlOOONTf 
 
 tN CA vot^ CO 
 
 to 00 '— ' CO to 
 
 CM 
 
 »-• r-x 10 Tf r>x 
 
 00 -^ CM "^ CO 
 
 to On On On 
 
 vo»-H coto vo 
 
 tO'-HtoOCM 
 
 CO 
 
 rf VOt^OO—' 
 
 OONCMTt-CM 
 
 CM(M -hOO^ 
 
 OO^t toco NO 
 
 00 vo^ttNO 
 NO i-«l CO CM rj- 
 
 00 C?n<7nO 
 
 t>: 
 
 ID CM CM r^ 
 
 CMLOTj- On"^ 
 
 »-i COCO COCO 
 
 CTni-h VOOO 
 
 CO NO 00 CM 
 
 tN. 
 
 t^QOr^co 
 m 10 r~^ 
 
 VOt^t^tO CO 
 
 NO CM 00 rf 
 
 -HOONOrf 
 
 On t^ to CO 0\ 
 
 CONOtOT}-!^ 
 
 00 
 
 TfCMT-H^CM 
 
 rj-NOOTT 
 
 t>xtOCOTt-tO 
 
 tNjOp coto 
 
 NO CO 00 CO CM 
 
 CM 
 
 t< c5 CM 10 t< 
 
 CO vd On CM* 
 
 to 00 CM to ON 
 
 SJ^SSS 
 
 CM* vd CO Tt^ 
 
 CM '-< K CO On 
 
 ^s[ 
 
 Tj-LOU->tOLO 
 
 VONONOVOt>» 
 
 tNt^OOOOOO 
 
 '-H CO vo C7n CO 
 
 tv. rq tN rj- ,-. 
 
 CM CO CO Tj- to 
 
 
 
 
 
 
 
 ^^^^CM 
 
 NO 
 
 Oco— tONiO 
 
 ^CM-^^rt 
 
 cjnooonocm 
 
 ONt^COVOTt- 
 
 ON^oooNo 
 
 C7\tOtxOr:t 
 
 t^ 
 
 CO Q CO VO vO 
 
 ONIN.CM OnO 
 
 ON On to CTn CO 
 
 t^tovotort- 
 
 t^ ^ cooOTi- 
 
 Orj-COWIN. 
 
 VO 
 
 CO ON t^O On 
 
 Tj- 00 -rl- to 
 
 CO 00 ""^ to to 
 
 1700 
 0714 
 9140 
 9808 
 8427 
 
 tNjfOOO-HVO 
 
 00 
 
 ScM^cScM 
 
 OOQO COOO 
 
 T^^NT^ONT^ 
 
 Tf ^00 ON CO 
 
 t^coCMCTNOO 
 
 Tf 
 
 '-'OCvj— .0 
 
 '-<0'-' OnCM 
 
 rC 00 to to NO 
 
 CM CM cotN ^ 
 
 Tj- 
 
 ONin vo»o 
 
 looNiocor^ 
 
 00 00 On Tf to 
 
 rt- -tM^n to CO 
 
 ^ 
 
 »-i ONiOOOOO 
 
 NO CM NO ONO 
 
 p On In. to CO 
 On CM t^ coo 
 
 ^C^OOt-" 
 
 '—1 On ONO 
 
 CM 
 
 vq o\ CM ^ ^ 
 
 vo^ootofo 
 
 CM CM CM CO VO 
 
 00 CO 001^ to 
 
 00 CM rt rt- CM 
 
 t^ 
 
 10 l< CM 10 
 
 t< CM to 00 
 
 :-^* Tj^ K CO 
 
 vd CO K t-I 
 
 rftoodtovd 
 
 '-H CM* 0(3 »-; CM* 
 
 ] 
 
 •^T}- 10 10 to 
 
 10 vo NO ^ vo 
 
 I^t^t>s00 00 
 
 00 ON On OnO 
 
 OCMTftxO 
 
 rJ-OOCMOOrJ- 
 
 ,-H 
 
 
 
 
 »— I 
 
 
 CM CM CO CO r^ 
 
 to 
 
 O'-'CM COT^ 
 
 10 NO tN. 00 On 
 
 O^CMcorh 
 
 to NO r^ 00 On 
 
 ^r "^ Tf Tt >* 
 
 Oto Oto 
 
 too»ooto 
 
 t^OOOOCTvON 
 
 
 
 CO^OCOCOCO 
 
 CO CO ro c*3 CO 
 
 ^^^^^ 
 
 iOiOVONOt>. 
 
 
 
348 
 
 TABLES 
 
 
 
 
 VOIOVO'-" 
 
 ovoor^co 
 
 co^Ot^t>^ 
 
 ONf^ voOn^ 
 
 COVOCOCO'^ 
 
 OM^"^00 CO 
 
 COTft^NO'-H 
 
 
 
 
 t^,-iii-)CM 
 
 IOCOVQt-hIO 
 
 t^ NO r^ NO CO 
 
 r^i LO CO -^ 00 
 
 rfr^OONOON 
 
 
 
 ^ 
 
 ONTTCOVf 
 
 ooio orv^io 
 
 CO 00"^'^ CO 
 
 VOOVOOO-H 
 
 t>^CO t^ CO ^ 
 
 COOOcOOLO 
 
 NO t-H OOOON 
 
 
 
 OCNlCNt^ 
 
 <M<NONCONO 
 
 t^OONVOON 
 
 NOrf^r-lOO 
 
 t^ T-I r-l 00 Tj- 
 
 
 
 ^ 
 
 VO-^OCA 
 
 OO^co— 'OO 
 
 ocor^ '-HON 
 
 coo --H CO 00 
 ,-iiocO COOO 
 
 ^ in -rt y-> 0\ 
 
 CONO OOOlO 
 
 
 
 irjt^vO'-H 
 
 u^OOOnOO 
 
 CO Tj-t^ COO 
 
 lO T-HtOOO ON 
 
 On TfLoCO -r}- 
 
 
 
 
 CVl 
 
 ^>. CN) uo VO 
 
 Tj-O'^t^r^ 
 
 OOlO ^LOt>^ 
 
 00 00 NO CO 00 
 
 
 
 
 ONO\oqt>» 
 
 vq lo CO i-; On 
 
 t^ LOCO On NO 
 
 COOt^ COON 
 
 LO T-I ^s. CO 00 
 
 Tf ONTl-ONTf 
 
 
 
 
 O'-Jcvi CO 
 
 ■rfiovdr>lt^ 
 
 OOOnOO^ 
 
 CO CO CO ^ Tj: 
 
 LO NO NO t< in! 
 
 oooooNONd 
 
 
 
 
 .-HlOt^ ^ 
 
 COOVO '— 'CN 
 
 lo-^ ror^rj- 
 
 ^ T-I fONOO 
 
 t^ lO C^l LO Tj- 
 
 fOONOTf t^ 
 
 
 
 
 ^mooc<j 
 
 
 cocoooooco 
 
 lOCOrfOON 
 
 CO t^ CO LOCO 
 
 NO NO t^ NO l-^ 
 
 
 Q 
 
 ^ 
 
 lO 0\V0O 
 
 C^l VO VO ■'l" 'O 
 
 vo r-H COt^ON 
 
 lO '— ' CO '— 1 LO 
 
 C4 t^ CO ON NO 
 
 CO CO CO 1^ On 
 
 
 owooN-*^ 
 
 lOt^Tt 00 o 
 
 T-( T-Ht^ON CO 
 
 VOCOOO NO On 
 
 T-H COLO 00 CO 
 
 CO T-H oco -^ 
 
 
 O 
 
 CM 
 
 ONTj-OOt^ 
 
 '^ Tf c^i '-' r^ 
 
 00 '-Ht^ LOON 
 
 T-H NO NO NO 00 
 
 r^ rf cot^ o 
 
 CO rHLO 00 CO 
 
 
 t— i 
 
 t^rt-ON"^ 
 
 ONTfOi^LO 
 
 NO On "^ COLO 
 
 CO rsif^ i^ CO 
 
 COOCOCOON 
 
 CO CO r-l l^ CO 
 
 
 « 
 
 t^co^oo 
 
 r^ii-).— ( Tfvo 
 
 NO-"^ '-I voOn 
 
 '-H »-• OnNOCO 
 
 NOOnOOOO 
 
 NO CO r^ o CO 
 
 
 M 
 
 
 ON ON 001^ 
 
 NOlOTTCVlO 
 
 CO vorf-H 00 
 
 NO CO ON vq CO 
 
 ON LO CO CO CO 
 
 On LOONO r-l 
 
 
 
 
 Or-; CM* CO 
 
 '"i^ioNdt^od 
 
 ooonOt-^t-; 
 
 CO coco •^LO 
 
 lONoKtNiod 
 
 ^2^^^ 
 
 
 
 vOrH^O 
 
 ^ONt^-"^^ 
 
 »— 1 lO C^J lO tv. 
 
 O-HOOLOrl 
 
 TfNOOCOO 
 
 I^NOONONO 
 
 
 < 
 
 
 T-H ONCV) t^ 
 
 loooo-^t^ 
 
 oocoi^r^ 
 
 LOCOOOCO o 
 
 CO --H CO "-H NO 
 
 T)-t^OO CO NO 
 
 
 w 
 
 
 rgocooo 
 
 ONO-^-^^ 
 
 lo 00 '-' CO 00 
 
 CO On '-H .-1 CO 
 
 CO ONOOrfio 
 
 NOLor^co Tf 
 
 
 ^ 
 
 ON^OOCNl 
 
 COLO 00 r^ 
 
 LOCO On 00 CO 
 
 Noor^coNO 
 
 CO OTt- OC4 
 
 LO COONt^OO 
 
 
 
 ■^"^ Os-^CM 
 
 LO 00 CO CO (N) 
 
 CN) t^ OO O rj- 
 
 Tf CO OCO On 
 
 "^OOO CO CO 
 
 
 o 
 
 fNI 
 
 
 ro »-H ^lOCM 
 
 (N) NO LO 00 NO 
 
 ONt^ T-H CO 00 
 
 -Hr-IOOCv] CO 
 
 coT^vo-HTi- 
 
 
 
 ONONCOS 
 
 ^ O r>. CNj o 
 
 oooot^^o 
 
 Tt l^ On On t^ 
 
 lO '-H lo On 1—1 
 
 CvJ CO O 00 Tf 
 
 
 
 OM>.LOCOr-H 
 
 00 LO CO On NO 
 
 CO O NO CO ON 
 
 LO rHr->co 00 
 
 
 
 
 cJ^csico 
 
 Tj^iovdtNlod 
 
 00 ON O -h' CO 
 
 CO CO T^ Tt LO 
 
 vot<t<odod 
 
 On d d r-H* T^* 
 
 
 
 
 
 T— 1 T— t T— t 
 
 T— ( T-I ,— 1 r-l ,— 1 
 
 T— 1 T-H ,— 4 T-I T— 1 
 
 •-H CO CO CO CO 
 
 T-i 
 
 
 ooioco'5}- 
 
 00 CO ON tN. CM 
 
 T-i r-l ONt^t^ 
 
 NO t^ CO CO CO 
 
 OOnOO^lo 
 
 NO NO -^Tt r-H 
 
 H 
 
 ^ 
 
 
 ONt^OlO 
 
 O vOcoOnco 
 
 On CO NO ON 00 
 
 TM^oor^r^ 
 
 CO '-H xt-NONO 
 
 On NO 'sT t^ X^ 
 
 s 
 
 < 
 
 ^ 
 
 OOOTj-CNJ 
 
 lOl^ r-lCM -^ 
 
 Oq t-H onOlo 
 
 ONOCO CO NO 
 
 r-l ONONt^LO 
 
 r-H T-H NO rj- T-H 
 
 OOsOOrf 
 
 LOONTl- vo On 
 
 COON^Tt-Q 
 
 CO ON 00 NOLO 
 
 00 '^ NO rj- 00 
 
 CO CO CO LOO 
 
 < 
 
 
 ^ 
 
 OOMDONON 
 
 OOONMDOTf 
 
 CO Tl-LONOO 
 
 CO OlononO 
 
 CO LOCO CO NO 
 
 r^t^t^ ONNO 
 
 PLH 
 
 tH 
 
 
 I>nOO '^LOO 
 
 t-it^ONt^CO 
 
 CO t^O '-H o 
 
 OOLOr-HVO^ 
 
 ^ 
 
 T— t 
 
 00 '^ 0\ CO 
 
 ^TfcoOvO 
 
 oco«^roco 
 
 On LO On CO '^ 
 
 lO"^ coo NO 
 
 OTj-r^oooN 
 
 1 
 
 
 ON On 00 00 
 
 t^ VO lO Tj- CN) 
 
 T-H On r^ LOCO 
 
 O CO to CO o 
 
 t^rt-— lOO'^ 
 
 T-H !>, CO On LO 
 
 
 p[4 
 
 o 
 
 
 O t-h" CN) CO 
 
 Ttiovdt<od 
 
 On On d -^ C4 
 
 COCOTtLONO 
 
 NO tN.' 00 00 On 
 
 O o ^' -h' CO 
 
 > 
 
 
 
 
 »— 1 1— 1 1— 1 
 
 T-I 1—« T-I T-H 1—1 
 
 »— 4 T— < T-t T-I r-4 
 
 cococqcNco 
 
 
 
 t^CVJCVJiO 
 
 l^tN.vO00C<l 
 
 IOONt-ICO O 
 
 r-ILOi— iOnI^ 
 
 ONCOt^lOt^ 
 
 OCOnOi-hOO 
 
 
 H 
 
 
 VO^-*^ 
 
 On^OnOco 
 
 LOJ>.C0 COLO 
 
 oo<^oo<r) 
 
 co^OnOOO 
 
 t^st^ cO"^co 
 
 coi^vTfr^io 
 
 M 
 
 
 
 r^t^ cou^^>. 
 
 Tl-I>vlOC0 '-H 
 
 OOVO'^-HLO 
 
 T-H T-H t>^ NOLO 
 
 
 ^ 
 
 (\j 00 O 00 
 
 -"tOOr-HCM^ 
 VO r-H CO OMO 
 
 ao >-< o CO 00 
 
 CO NO T^ NO NO 
 
 CO coco NO O 
 
 T-H CO l-H 1-H t^ 
 
 < 
 
 f\j 00 OJ CO 
 
 ,— 1 ,-.lOLO CO 
 
 CO CO NOLO r-l 
 
 
 NO NO NO t^ O 
 
 ONOor^No^ 
 
 H 
 
 S 
 
 irj»J-)CM Tj- 
 
 CO t^ 00 too 
 
 CO-Ht^^co 
 
 CO r-l l^ CO NO 
 
 00 o o o O 
 
 15 
 
 00 lOt-HU-) 
 
 00 On ON 00 vo 
 
 CO t^O fO '^ 
 CO pONt^LO 
 
 "^ CO Ot^CO 
 
 NO O CO CO CO 
 
 T-H On NO CO t^ 
 
 
 
 ON ON ON 00 
 
 t^ vOvoTt CO 
 
 CO T-H ON NO Tf 
 
 T-H On NO CO p 
 
 tN. CO p tN. CO 
 
 
 < 
 o 
 
 
 Or-Ic\ico 
 
 Ti^iovot^od 
 
 On d d i-H CO 
 
 COTf TfLONO 
 
 tN.' r< 00 On d 
 
 ^-Hr-H^CO 
 
 d r-I CO co' CO 
 CO CO CO coca 
 
 
 
 oq oO'-'oo 
 
 Tj- CO in ON 00 
 
 r-l t>^t^ NOLO 
 
 CO t^ On CO On 
 
 COLO'-HTfr-l 
 
 LOON LOCO NO 
 
 
 W 
 
 
 CO<OC>»ON 
 
 O On 00 CO On 
 
 ONCO ONVOt^ 
 
 On CO CO On LO 
 
 T-H OnOntJ-io 
 
 NO ONCor^Lo 
 
 
 
 Tj-iocor>. 
 
 lO ONlO -^ -^ 
 
 coQcocJT^ 
 
 OOOt^ T-( CO 
 
 LOCOr-nrtCq 
 
 LOCO 00 00 r^ 
 
 NOTj-COt^rf 
 
 OOCOONt^tN. 
 
 
 H 
 
 ^ 
 
 lO'-H COlO 
 
 CNJ O ^OQLO 
 
 TtON'-H'^O 
 
 rH On NO coco 
 
 NO LOON T-H T-H 
 
 
 VO'-<LOO 
 
 t>^co^ooo 
 
 LOOO COr-iLO 
 
 LO CO On LO CO 
 
 CONOLO OCJ 
 
 CO CO CO LOO 
 
 t^ r-l NO CVl O 
 
 
 « 
 
 ::5t 
 
 t^ NO CO 00 CO 
 
 LOt^ONOO 
 
 SR^R)2^ 
 
 ONOnOCO'^ 
 
 
 o 
 
 00MDCV)t>. 
 
 "-H Tf voNo vo 
 
 rj- t-H t^ CO t^ 
 
 ON NO CO 00 Cv) 
 
 LOOOONOO 
 
 
 
 1— t 
 
 ON On ON 00 
 
 oqt^^u^rt; 
 
 coco pONtN. 
 
 NO "^ CO p CO 
 
 LO COr-^ CONO 
 
 CO O t». LO CO 
 
 
 
 CJT-Jcsico 
 
 Tfiovotvlod 
 
 On d T-; r-! CO 
 
 COTfLOVO^ 
 
 K 00 On Ovd 
 
 l-Hr-I^T-HCO 
 
 T-H* CO CO CO rj^ 
 CO CO CO CO CO 
 
 
 
 ,-lVO'-llO 
 
 Tft^COVOOO 
 
 COLOt^l^rJ- 
 
 C0 00t»»00O 
 
 r^ CO "^ CO NO 
 
 OnO OnNOO 
 
 
 M 
 
 
 OOCvjiO 
 ONlOlOlT) 
 
 COrfiOt^iO 
 
 LOCO T^oo 
 
 LO r^ Cv) LO LO 
 
 ON r-H CO r-(CO 
 
 X^NOLO i-H CO 
 
 
 w 
 
 
 '-' vOtM:>»1>. 
 
 rJ-OOt^Oco 
 
 C^l CO r-H CO OO 
 
 CO COONt-hW 
 
 LO CO l^ COLO 
 
 
 W 
 
 
 On ON 00 vO 
 
 COt^ ONt^ t-" 
 
 OCsIt^Tf O 
 
 LOr^ LO NO O 
 
 iooot>,cx) CO 
 
 LOOO-^OO 
 
 
 ^ 
 
 OCOONON 
 SOOr-H 
 
 rt rl- ^ VOO 
 
 coNO or^r^ 
 
 O 00 Cvl CO o 
 
 LO On coooco 
 
 "-H CO NO '^^ r>. 
 
 
 i^ 
 
 COiOOO '-H VO 
 
 T-H t^ IJ-) CO CO 
 
 LO l>^ C^l CO NO 
 
 LO NO OlO CO 
 
 CO lo On NO LO 
 
 
 Qj 
 
 
 ONt^-^O 
 
 lO O^, CO to \o 
 
 t^ NOLO coo 
 
 NO ^ NO ON CO 
 
 ■^ LO NOLO Tf 
 
 Cq ONLOr-H NO 
 
 
 HH 
 
 
 ON ON On On 
 
 00 In. tN; NOLO 
 
 Tf CO CO '-H p 
 
 00 ^s. LO CO CO 
 
 p CO NO Tt CO 
 
 or^Locoo 
 
 
 
 
 O '-< 04 CO 
 
 ■^uSvdtNlod 
 
 On d t-h" CO CO 
 
 CO '?}-LO NOl^ 
 
 00 00 On d r-H* 
 
 CO CO CO ^ LO 
 
 1^ 
 
 
 
 
 
 
 T— 1 T— 1 T—l T-H T— 1 
 
 »-• T-H T-H CO CM 
 
 CO CO CO CO CO 
 
 M 
 00 
 
 
 en 
 
 .2 
 
 rHCVlfOTj- 
 
 io\ot>»ooo\ 
 
 OrMCOco-^ 
 
 ioNor>»oooN 
 
 COCOCOCOCsl 
 
 lONOtN^OOON 
 
 CO 
 009 
 
 
 
 
 
 «— 1 1— H T— 1 T— 1 1— t 
 
 CO CO CO CO CO 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 349 
 
 CM Ti- .-H oor^ 
 o >^o o\ '— I CO 
 
 ON CO 00 eg r^ 
 
 O ^' -h" (VJ (NJ 
 
 COO'-' o-^ 
 t^t-H OOco-^ 
 
 .-'Ol COVOCO 
 
 lO vot^ooo 
 
 Tj- lO >r) Tl- CO 
 '— '1^ On cot^ 
 
 lOOcO Omo 
 OOC»MDtJ- 
 lOCM nO^^On 
 l>. CM O -^ ■'^j- 
 
 r^ .-I NO "^00 
 
 CM NO O ^ CO 
 ONOCMNOO 
 ,-, -rf CO T-* xn 
 u-j to trj NO Nc5 
 CM CM CM CM CM 
 
 VOCMiO^-it^ 
 
 OONOvot^T^ 
 CO C3n CM COON 
 CMNOCX)iONO 
 
 0.-H Tt'-l CO 
 
 C0'<^t^c0'-' 
 
 COLONO t^t^ 
 
 OOOOCMOOO 
 
 NOCMTfOON 
 T-H ONNOt^NO 
 
 CO On NO IT) 00 
 CM CO 00"^ t^ 
 
 NO '-H ONOC^N 
 
 cOt^C7\ON00 
 00 On c5 ^ cm' 
 CM CM CO CO CO 
 
 TfCMVOOOON NO 
 
 "^tCMOOTfOO CM 
 
 Ot^TfOO O in 
 
 Tt r-Hr-H «Ot^ O 
 
 r^oocMt^'-' 1-H 
 
 CM T-i NOm On rl" 
 
 CM voOnNONO t-H 
 
 r>. Tt p NO T-<^ NO 
 
 COTj^lOU-JNO NO 
 
 COfOCOCOCO CO 
 
 in NO On t^ 00 
 COOO'-'t^'-' 
 On r-i r^ONNO 
 CM CM r^ CM CM 
 
 coo NOLO 00 
 
 u-jr^t^ t^ NO 
 
 Tj- -"^ CO 1— I 00 
 
 Vq T-H NO T-H U-3 
 
 '-H CM CM* CO CO 
 CM CM CM CM CM 
 
 t^C?\00 00NO 
 irjiOOO '-I NO 
 
 ONNO»J^O\t^ 
 
 l^ NO NO On 00 
 lOTfcoCM CM 
 Tt On CO NO 00 
 O'^ONCOt^ 
 
 ^TfOVOON 
 CMt>^C7N^NO 
 
 CM r-tCOCOON 
 
 CMCOOCOO 
 Lo T-i CA Ot^ 
 COiOt^CMt^ 
 O\ON00t^ ■'^ 
 
 NONONCJKt^ 
 
 CM CM CM CM CM 
 
 OO0Ntv»0\ 
 inirjLot^ ,-t 
 
 a\rf CM t^o 
 
 ^Tj-NO'^t^ 
 
 '— ' rr OOiO NO 
 lOTj-lOONlO 
 
 '-it^CM^O 
 
 T-( Tj- 00 '-I lo 
 
 t^OOiOvoCM 
 
 CMcooOQOn 
 NOTfCM^Ti- 
 ONlOlOTt 00 
 CO vo On COO 
 ""^CMOOOCM 
 
 cor^Ti-00 00 
 00 CO t^N. On p 
 On ^ cm" CO "S 
 CM COCO COCO 
 
 lOCMCMtOCM 
 lOLOCOiOt^ 
 
 li-) ,— I rl- CO »— I 
 
 lO Ocovo 0> 
 
 rj-r^ comvo 
 
 NO t^ 00 00 00 
 On CO NO 00 On 
 coCTn-^On"^ 
 cm' CM CO CO "^ 
 CM CM CM CM CM 
 
 COOO '-" Oco 
 cOTfrfNOOO 
 
 c^cM coooo 
 
 OOOQOnOCM 
 
 c^oONO'^o 
 
 On Tj- On Tj^ On 
 
 •^XOlONONO 
 CM CM CM CM CM 
 
 rtmoocor^ 
 CM -^u-) coo 
 On On CO CM CO 
 
 t^ 00 On NO NO 
 
 lOONTl-r-i On 
 
 »J-J ONCONOt^ 
 
 cot^CM vo O 
 
 t^QVOl^»-< 
 OOOOnioo 
 OncOi-hCTnOO 
 lO T-H OOt-T^ 
 r-H COlJ^T-l O 
 
 OCMNOCOCM 
 On O\00l^"^ 
 TfOOCMNOO 
 
 ONCMOOmON 
 OOiONOiOCM 
 to t^ NO lO On 
 OOOOONOt-h 
 NO t^ 00"^ NO 
 
 COTj-Ot^CX) 
 
 CMr^NOC7\C7\ 
 
 '^^ T-H W ,-H Tf 
 
 '-I corf NO tv! 
 CO CO CO CO CO 
 
 COO\C?N 
 com CA 
 
 TfCOON 
 
 1-H^OO 
 
 T-HinCM 
 
 t^Tt ,-H 
 NOt^t>. 
 
 odo\CJ 
 cocoTt 
 
 NOTf Tt 
 
 T— iLO NO 
 
 C?\CM T-H 
 
 CM CM IT) 
 
 On O CO 
 
 NCO 00 
 
 00 00 On 
 
 mco O 
 
 t-h'cM CO 
 
 <«1- O t^ T-H CTn 
 rO»0 Onu-)00 
 
 C?\NO00C?Nt^ 
 
 ■<^t^VONOt^ 
 
 00 00 00 ON CO 
 lOONCOl^CM 
 CO 'O Tt O NO 
 1-H t^ CO CA Tj- 
 
 CO CO Tf ^' vo 
 CM CM CM CM CM 
 
 OCOtOt^t^ 
 
 ooomtoLo 
 
 T-HCMTl-T^OO 
 tOiOrJ-OOCM 
 
 CM t^ QCM NO 
 
 t-^CM 0\NOrt- 
 
 Si 
 
 NONOt^t^OO 
 
 CM CM CM CM CM 
 
 ioC?nnOCMt-i 
 lO 00 CO CM CM 
 CNt^i-HtoCM 
 CMcoOMDt^ 
 
 OCOnOnOO 
 CM CM CM CO CO 
 
 T-H T-H T-H On ro 
 NO CO 00 CM NO 
 CMTfCMT-H o 
 NOt^TfOOO 
 CM Tf On 00^ 
 
 NO NO 00 CO T-H 
 NO T-H lO ON CM 
 0^ '<:*• 00 CM t^ 
 O r-J ,-H* CM CM 
 
 CO CO CO CO CO 
 
 VOOCMOOl^ 
 rj-mmt^NO 
 
 ONIOIONOCM 
 
 OTf oo<?\0 
 
 CM "^CMOOn 
 T-HirjcoOt^ 
 
 Tj-CONO'^t^ 
 
 ^T-HChNOT-H 
 
 roiONOodo 
 CO CO CO CO"* 
 
 t-HTj-ONt^lO Tf 
 
 t>vt^t^CONO O 
 
 t^'^'^OCM CO 
 
 t^coOT-HCo t>x 
 
 -^OnOVOOn Tl- 
 
 t^ CTmo T— I tN. ,_ 
 
 OOt^NOlOTj- NO 
 
 lo 00 p 1-; T-H o 
 
 t-h' CM rf lo NO »< 
 
 Tf "t rt Tj- Tf Tj- 
 
 T-H CM Tt CM ON 
 OGOI^rfTj- 
 00 vo 00"* 00 
 CO "* covo CM 
 
 00 T-H ^ ONt^ 
 
 lo Nor>> 00 T-H 
 
 T— < r:J- NO r^ 00 
 p NO CM 00 Tf 
 
 Tt Tt lOVONO 
 
 CM CM CM CM CM 
 
 OOT-tOcoOO 
 lOCO"* VOOO 
 r^r^r^^CM 
 
 OnOOCMvoOO 
 vo NO "-H O vo 
 
 VOOt^ VOTf 
 
 t^ NO CO O NO 
 
 ONOCNOO CO 
 
 tvlt^ododoN 
 
 CM CM CM CM CM 
 
 OOntM^CO 
 CMt^OvoCM 
 
 voOOt-hCM 
 Tt NOVO CO CM 
 
 OOONOCMNO 
 
 VOOOTfi-HO 
 
 OOcoioioOn 
 T-H 00 On NO CO 
 
 t^ ON T-H CO CO 
 
 COOO OvvoOO 
 CO Tj- T-H vo NO 
 CM NO CO CM Tl- 
 lovovorf CM 
 lO Ovrjo vo 
 CM* CO CO Tt^ ■'^ 
 CO CO CO CO CO 
 
 t^r;^c7N00co 
 
 opooo^oo 
 
 CO ,^ 00 NO T-H 
 OO^NOOOt^ 
 
 vo'^CMrv.oo 
 Chj-^Ot^'^ 
 
 On CNj crj CO T-H 
 
 rt t^ C3N T-H* CO 
 
 co^^coTf* 
 
 ■«tO\00 
 COrl-T-H 
 
 8 CO CM 
 CM CM 
 NOcot^ 
 
 cmtj- r^ 
 
 vo vo NO 
 
 5^ 
 
 TfO 
 
 vno 
 
 CO 
 
 r-) 
 
 
 r^ 
 
 g^ 
 
 ;^ 
 
 CM Tj- 
 
 vo 
 
 ONO 
 
 ,_! 
 
 Tl-VO 
 
 lO 
 
 lOTl- 
 
 NO 
 
 COTt 
 
 CO 
 
 Ot^ 
 NO CM 
 
 0\ 
 
 CO 
 
 
 CO 
 
 NO T-H 
 
 
 S:^ 
 
 o 
 
 coOootOTh 
 
 CM ^T-H '-HTj- 
 
 nOOtJ-CM NO 
 
 OONt^ NOVO 
 
 ON CM CM ON Tf 
 OOOn^tI-O 
 OONOrfONO 
 (50 vOCM ONvrj 
 
 Tj- vo NO M3t>I 
 CMCMCNlCMCM 
 
 CMt^CTNCOCO 
 CM CO vo CO 00 
 00 t^ CM T-H On 
 vo NOOOO T-H 
 00 CM t^ vo to 
 t>^t^ OOCM 00 
 
 OTfr^O'-H 
 
 CM 00 Tj- ,-H t^ 
 
 OCJodONOO 
 CM CM CM CO CO 
 
 NOCMrJ-ONO 
 
 T-H CM rococo 
 
 CO vo oco vo 
 
 CO CO T-H t^ ON 
 
 On 00 CO ■* CO 
 NO t^ T-H t^ NO 
 CMCM CM OOO 
 CO On vo >-H NO 
 T-H '-H* CM* CO CO 
 CO CO CO CO CO 
 
 »OCMCMt-hO 
 CMCM -^ONt^ 
 
 OOCMTj-ONO 
 NO 00 CM 00 CO 
 T-H OONO-^vo 
 OOCM O^vo 
 VOCM 00 cot^ 
 CM 00 CO On Tf 
 
 Tf Ti^ vrj vn NO 
 coco CO coco 
 
 Tff^NONCMCNj 
 
 t^ NO t^ CM NO 
 vo NOt-h ovo 
 t^ 00 ON 00 t^ 
 00 MDvo On NO 
 ^^^IZJ'^OCJN 
 T-H p CO CM NO 
 
 pvqocoTf 
 
 InI C?N CM Tf NO 
 
 CO<*^TfTtTl- 
 
 r^ NO 001 
 
 CM Ovo' 
 OI^Oni 
 
 t^ VOVO' 
 
 CTnNOO' 
 
 rf CO T-H 00 Tf C7\ 
 00 O CM* CO lo NO 
 
 TflOlOlOlO lO 
 
 CMt^r^toON 
 
 CM CO-* vo 00 
 00"^ On CM vo 
 
 OOO 00 ON NO 
 t^CM VONONO 
 t^ CM On On CM 
 O*N0 00O 
 
 00 vo CM ov ^>: 
 toNot<i^od 
 
 CM CM CM CM CM 
 
 {Tn^-^-OOO 
 
 SOCTncoOn 
 vo On CO CM 
 00 O ONO CO 
 vo vo VONO O 
 
 00 t^ On* CO 
 OOOnOOno 
 *-Ht^rl-^ 
 
 On O O T-H* CM 
 COCOCOCO 
 
 i-HCM-^NOCM 
 T-HCM i-H Ovo 
 
 NO On 00 00 CO 
 00 00 OOvo 
 nOn3t-hO* 
 Tf OnOOOvo 
 CO ON vot-h vo 
 
 OO^-r-HOO* 
 
 CM 
 
 TfOOONO^ 
 
 *OOTft^ 
 
 00 NO On On 00 
 O CO On vo t^ 
 voCMNOOnO 
 ■*t^ CO CO 00 
 OnCM vot^xOO 
 
 Ot^COC^NVO 
 
 NO NO t»i ^s.■ 00 
 
 CO CO CO CO CO 
 
 COVOr-Ht^lO 
 
 »or-;"*t^co 
 
 I^CMoOt^* 
 
 T-H On CO O T-H 
 T-H T-H ovo vo 
 NO fi VONO 00 
 (?\*vocM NO 
 
 T-H T-H C7N NO T-H 
 
 C^NCMrttviO 
 
 CO**-* in 
 
 O'-'C^cO"* lONOtxOOOx Q'-hCMcO* iOV0tN,00O\ 0»00i00 lOOtOOiO o 
 fococococo COCOCOCOCO '*'*•*■*'* *"*■*"*"* iOvovOVOt>. t>. 00 00 On CTn O 
 
350 
 
 TABLES 
 
 Q 
 O 
 
 Ph 
 
 w 
 
 u 
 
 o 
 
 Q 
 "A 
 
 < < 
 
 Ph ^ 
 
 ^ S 
 
 W l-H 
 
 H ^ 
 < 
 
 o 
 
 W 
 
 O 
 
 W 
 
 00 
 CO 
 009 
 
 
 CO tV.lO 1— < 
 
 ON CO TfT-Ht^ 
 
 looorfvoco 
 
 ONt>.ON00C3N 
 
 CM CM CM 00 CO 
 
 VO ON Tj- 00 rj 
 
 
 CM voOnvo 
 
 t^ CO Tf 00 CVl 
 
 CDiOOvON 0\ 
 
 c^cM vo-*"^ 
 
 OOuoOncovo 
 
 CM VOIRON to 
 
 »-H ,-H ^ (Nl O 
 
 
 VOCM '-IVO 
 
 CO Tj- r-H CO CM 
 
 t^-^ CO CM CO 
 
 — * VO i-H 00 t^ 
 
 vovOrt-rf>-H 
 
 
 0\0n— <o 
 
 vo(^^ooc:^ON 
 
 OOt^rtcOOO 
 
 '^CMOO'-i 
 
 CM IN. 00 t^ to 
 
 to voco VOCM 
 
 ^ 
 
 cOfOO'-' 
 
 cococor>N VO 
 
 OCOOOVOON 
 O vOcoCM Tt- 
 VOOOOO»JO On 
 
 CM 00 CM VO l-H 
 
 OOtOCOCO 
 
 CO^-i tOT-il^ 
 
 CO CO com 
 
 CMt^CM 0> r-i 
 
 CMiOI^t-xOO 
 
 ONTfr-H CO O 
 
 S3S28^ 
 
 VO 
 
 Tt-cor>xVO 
 
 --ht-hOOOO 
 
 '-I Ot^CMtO 
 
 VO VO-* Oto 
 
 
 ON00VO-=t 
 
 C^l On Lo CM 00 
 
 CO 00 CO 00 CM 
 
 t^—'TfOO'-i 
 
 tM>vO coto 
 
 t^ p CM ""^ to 
 
 
 Ot-h'cMCO 
 
 rt TtiOVOvd 
 
 KKociodcK 
 
 OnOOCDi-; 
 
 »-5 T-H cm' cm cm' 
 
 CM CO CO CO CO 
 
 
 lOCOCO O 
 
 r^vo o vooo 
 
 CO CM-* ON Tf 
 
 TtVOiOOVO 
 
 Th^OOOOCTN 
 
 tv.OCMVOOO 
 
 
 ON'^OiO 
 
 vOO-^t^* VO 
 
 ON CVl VO C3N On 
 
 O i-O <M ON 00 
 
 OOCTNVOVOO 
 
 CO r^ to 00 IN. 
 
 to CO VO CM tr) 
 
 
 ooooo 
 
 VOCM roCM ^ 
 
 '^l-M-'-'CNO 
 
 O CM CVI CO '-H 
 
 TttOCOt^CO 
 
 in 
 
 OOi-HTfLO 
 
 r^ONi^ '-' CM 
 
 CO'-HtOt^-"^ 
 
 irjVO VOOOCM 
 
 CM '-'Otovo 
 
 ■^OOCOCMt^ 
 
 COtJ-CMOn 
 
 TfvocoCMOO 
 
 ^^T;^CMlo VO 
 
 VOt^OiOCO 
 
 ON-HOr-HO 
 
 CM ONCOiO 
 
 CMO VOCOI>^ 
 
 T-H VOCOCOC50 
 
 ONt>v^CMO 
 
 CM -H CO 00 00 
 
 CO to CO 00'-' 
 
 iOU-)CM Tj- 
 
 CMt-xOO VOO 
 
 CM O VO OOn 
 
 tN. cot^OOOO 
 
 VOCM VOOOOi 
 
 CM>. Tf C?N ■* 
 
 
 0\00t^>0 
 
 COOt>^Tfr^ 
 
 t^ CO 00 CO 00 
 
 COOOCM VOO 
 
 't^OO'-H'^I^ 
 
 OCOVOOO'-H 
 
 
 O^'CMCO 
 
 TtlOlTJvdK 
 
 KOCJOCJONON 
 
 O O t-I i-h' CM 
 
 CM* CM CO CO CO 
 
 rf Tf rt^ Tf to 
 
 
 Ovomo 
 
 -■^oo^t^o 
 
 00 CM 00 CM 00 
 
 COIOCOOON 
 
 tOOO VOCDnI^ 
 
 VO to CV1 '-' CO 
 
 ^ 
 
 oorN.coi^ 
 
 t^ -^ C7N O VO 
 
 -HONt^rl-(N 
 
 t^O^OOiO 
 
 rf 00 1^00 CO 
 
 CTNTf OOtoto 
 
 tN.r^rl-iO 
 
 VOOJOVOO 
 
 OOVOOCMiO 
 
 U-5 to .— 1 T— 1 CO 
 
 VOCO^'^OO 
 
 00 '— ' CM CO 00 
 
 :^ 
 
 COVOVOCM 
 
 l^ t^ O CO 0^ 
 
 r-H ,-1 ooiocg 
 
 ;?;s2^8^^ 
 
 COCM CMl^tN 
 
 Or-HOt^OO 
 
 CM voco 00 00 
 
 On VOOMO 
 
 o\ooi^ cor^ 
 
 rv. On to 00 00 
 
 OM^ ■* tv. Tj- 
 
 Tj- 
 
 vocMoor^ 
 
 On t^ C^4 lO 00 
 
 CM 00 00 CM CM 
 
 CATft^ONCO 
 
 t^Tl-Tft^lO 
 
 OOVO^CN'-' 
 
 
 irjt^Tj-CO 
 
 OOLO On On VO 
 
 
 CO CO O to On 
 
 OO00T^C7^ 
 
 C^Tj-tOTf CM 
 
 
 C3N00t^iO 
 
 CO .-; 00 "^ CM 
 
 ONio^^vqcM 
 
 t^CMt^ .-H to 
 
 O'^t^^'^:!- 
 
 00 i-i rt t>. p 
 
 
 CDi-h'cMCO 
 
 T}-' Lo liS vd tN." 
 
 tN^odcSoNO 
 
 O ^ -^ CM CM 
 
 CO CO CO TJ-" Tt 
 
 rfiotoiovd 
 
 
 \ 
 VoKcoCM 
 
 covot^t>>'-. 
 
 O0r-< voioco 
 
 co»-Htof^O 
 
 rttocot^rf 
 
 Tf 00 to CM CO 
 
 
 ■^NOOCM 
 
 COOO vooovo 
 
 r^t^x^oo c^ 
 
 TfVOOOONTj- 
 
 coOnco VO i-H 
 
 ONr-Ht^CMVO 
 
 
 
 CMvOt1-tJ-^ 
 
 lONOcot^CM 
 
 t^voOO VOOn 
 
 VO Omo '-H CO 
 
 CJN <?N to CO -rt 
 
 
 COiONONON 
 
 CM CO lO-^ CO 
 
 ONt^l^TfCM 
 
 OOONVOCAco 
 
 (N) 1/-J ^ Tt VO 
 
 t^ VOOOVO T-H 
 
 ^ 
 
 lolOOCO 
 
 OO'-i Ol>. CO 
 
 OO-'^fOVOT-H 
 
 cO(M VOCM On 
 
 CO ,-.^00 ON 
 
 Otv.toOtN 
 
 ^KO"-JO\ 
 
 '-I CM C^l CM U-) 
 
 O O VO lO CO 
 
 CO cvi to On CO 
 
 oc^ l-H VO VO 
 
 CM CM On CO CO 
 
 -* 
 
 VOPOt^CM 
 
 lOT^ococo 
 
 '-CVOOOOOVO 
 
 1— ito votoco 
 
 ON CM to to Tf 
 
 CVJ 00 CM VO 00 
 
 
 Tt CM o i>: "^ 
 
 T-Ht^COONlO 
 
 ^NO—iVO'-H 
 
 to p Tt 00 CM 
 
 vqcAcovqoN 
 
 
 Oi-TCMCO 
 
 Tt»J^vdvdt>I 
 
 0C5 00 CTn On O 
 
 r4 -r^ CM (Ni CO 
 
 cO'^'^rfto 
 
 T-H T— ( 1— 1 1— ( 1— t 
 
 toio vd vd vd 
 
 »— I .— 1 .— 1 l-H 1— 1 
 
 
 tN.OOOO'-" 
 
 OOCM 00"*T-H 
 
 CM-* CO ON 00 
 
 O^OncoCM 
 
 oo-^t^o 
 
 On VO »— 'to O 
 tOCM tOOOO 
 
 
 lO CM On CM 
 
 COOO\LOIO 
 
 cOOCOTfCM 
 
 lOr-HTJ-OOO 
 
 c?N 00 to r>. rt- 
 
 CO CM 00 ■* VO 
 
 
 rOTf vOC?\ 
 
 CM CO coi-O VO 
 
 OvoOi-Ht^ 
 
 cOrt-rfOt^ 
 
 Ti- cv) -^ 00 r^ 
 
 ^ 
 
 . 00O\cot^ 
 
 O '-0 Lo On VO 
 
 OVOCOCOCM 
 
 i-^ l-H CM 00 CO 
 
 or^CMr-ivo 
 
 '— 1 to VO »— ^ NO 
 
 
 NOlOCOt^lO 
 
 Tj-T-H fOVOOO 
 
 rJ-ON^Tt-co 
 
 tOCOCOOt-^ 
 
 ^ 
 
 voOi'-i CO 
 
 lOOO-^ cot^ 
 
 VO -^ CO CM O 
 
 r^n-^cTNON 
 
 CM t^r^ooo 
 
 '-I OtOt-NtO 
 
 vOONOt^ 
 
 r-HCM^t^O 
 
 ;^8^^S^ 
 
 i— ' ONtoOOO 
 
 ^ONVOCMtO 
 
 00 On 00 voco 
 
 CO 
 
 ON 00 00 VO 
 
 lOCOr-i OOVO 
 
 to O NO T-H t^ 
 
 (N| NO i-H vq p 
 
 Tj- 00 CM VOO 
 
 
 CD t-h' o4 CO 
 
 TtirjvdvdtNl 
 
 OCJONONOO 
 
 '-< CM CM CO CO 
 
 Tt Ttiotrivd 
 
 vdvd In! t<OC) 
 
 
 0\0i00 
 
 Ont:1-voCACM 
 
 Tt l-H On CO Tf 
 
 00 '-I ONCOr-i 
 
 ONcor^oO'-t 
 
 vOTtTj-ONCM 
 
 c^NCMtNcocn 
 
 
 r^t^ coTj- 
 
 -HTtC3N-HON 
 
 OO-^O'-H 
 
 00 '-I voco '-' 
 
 vOrf rt CMto 
 
 
 co ON l-H oO 
 
 l^ t-HCM CM 00 
 
 CM ■* CO to CO 
 
 to CM COCOON 
 
 rf Tt VOOOCM 
 
 r^CM '-' OOrf 
 
 
 
 OC^nOOOnO 
 
 O CM O lO t^ 
 
 coo-^-^c:jn 
 
 t^CM-^O-^ 
 
 ^''t COO|^ 
 
 
 00 ^ *o o 
 
 t^ r-(CM VO'-' 
 
 CM VOOC3NO 
 
 on^ r-(tor^ 
 
 Tt-OONVOtO 
 
 
 ^ 
 
 ocooot^ 
 
 0^r^0 ctnvo 
 
 OCM -<^rfvo 
 
 t^i-H VOCOCO 
 
 t^tovo coto 
 
 covor^s'^oo 
 
 
 l^ ,-H ro ^ 00 
 
 coiou^ CO Ov 
 
 CO NO VO to CM 
 
 f^i— 1 CO-^co 
 
 r-H r>>. CNl VO CO 
 
 CO 
 
 ON ON 00 r^ 
 
 lO Tj- CM p t^^ 
 
 u-5 CM ON vq CM 
 
 ONtOi-jt^CO 
 
 OOTfCJN-^ON 
 
 T^oocot^'-' 
 
 
 Ot-4cmco 
 
 "^ lO vd iNi t^ 
 
 OOOnOnO T-H 
 
 '-< CM CO CO rt 
 
 Tt toio vd vd 
 
 t<K0d0C3ON 
 
 
 T— 1 •^ COl^ 
 
 VOOO VO '-' VO 
 
 vovovo VO-* 
 
 CM to On '-'t^ 
 
 COCMr^t-nO 
 
 tOCM COOOO 
 
 
 Oco^ 00 
 
 OOt^O^fM 
 
 .-^CMVO00.-H 
 
 C3N r-H NO VO to 
 
 T-H-HOOVOtN 
 
 C^NON^rf O 
 
 CM 
 
 vC^CMt^ 
 
 .-HVOOOTfCO 
 
 VOOCOO 00 
 
 OOCOt^ VOr- 1 
 
 (M VOOnOOVO 
 
 X^ to ■rfvot^ 
 
 CO CM VO CM 
 
 OOVOO '— 't^ 
 
 r^ voo '-' o 
 
 CM^ OVOQ 
 
 to'^ C7\ t-i On 
 
 1— Ito r^ CM to 
 
 CM "^ CM "^ 
 
 IJ^ CO "^ CO VO 
 
 OOCM OO 
 
 VO to >—< l"^ CZi 
 
 CM C^N^t cotN 
 
 CO CM On 00'-' 
 
 COOCM On 
 
 CM CM On -^t^ 
 
 O C^4 Tf t^ 1— c 
 
 "<|-00OO On 
 
 vo-rf toco VO 
 
 t^CMcoONO 
 
 OOCMCMOVg 
 OpOOtoCD 
 C3N •g; OC) CO 00 
 
 t^CMTfco 
 
 .— 1 VOOO ONt^ 
 
 too co-^ Tf 
 
 CNl On -"^ t^ O 
 
 On On 00 t^ 
 
 vq^cMOoq 
 
 vOCOr=;00^ 
 
 i-; 00 Tf p vq 
 
 CM !>. CO CO "^ 
 
 
 c5'-H CM CO 
 
 rj- irj vd t>^ tN^ 
 
 00 ON CD O -^ 
 
 CM cm' CO Tt ""^ 
 
 totovdvdt^ 
 
 bvlodoCJONOv 
 
 .2 
 
 0) 
 
 Ph 
 
 i-tCMCO'^ 
 
 lOVOt^OOON 
 
 0»-'CMCO'«1' 
 
 to NO t^ 00 ON 
 
 o^cMco:^ 
 
 tOVOt^00O\ 
 
 
 
 
 
 CM CM CM CM CM 
 
 CMCMC<ICMCM 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 351 
 
 lO o\ 0\ »-i tJ- 
 t-H Onco VO'-" 
 ,-Hioroa\.-H 
 coOOrfCM Tt 
 OOOOCN »-• 
 
 VO C^^00 CO vo 
 
 t^ONOCVJ CO 
 
 CVJ ONt^OO 
 OOOVOVOO\ 
 CA CM CO rf n- 
 Tj- vot^OO On 
 
 CM ON 00 VO CM 
 covoCNCNt^ 
 
 OOCOOOi^ 
 m'Tf CTn Ot^ 
 
 trj IT) lO irj lO 
 
 vooNr^t^oo 
 
 OCNt>*CMCO 
 VOrf CMCMTf 
 00i-OTf«— <iO 
 
 ^O^Ov"* 
 VO ONVOCX)00 
 t>; On '-H_ CM CO 
 
 Ot^OC^""^ CO 
 
 t^ CM CM "-^ CM 
 
 OOCTncoOnO 
 VO w^ COCN (M 
 
 ONi-HTft^OO 
 CMOlOr-H^ 
 
 VO 00-^ NO CO 
 ^COCvJ ooo 
 O'-'CM coco 
 coco'Tt-Tt-Tf ■^Tt'^TfTt- u-JLTJioiOLo toirjioirju-j ii-3irj\dvdvd vdNOvdvONd vd 
 
 '-H r^ NO Tt Ti- CM 
 
 OOONOOCM NO 
 
 T^ cOTf On CO Tf 
 
 00 '—I On NOON m 
 
 itjOOOOOO t>. 
 
 u-> O "^ t^ O y— 
 rt-iniomNO 
 
 NO 
 
 coOt^'-' '-• 
 OiONOCM O 
 '-I OnOOn-^ 
 
 to r-H r^ T^t O 
 
 Tj-oONO»o On 
 CM CM CM CM CM 
 
 t^ONOCDCh 
 
 coiooqo r-H 
 
 vo irj u-j NO NO 
 
 On »— ' -^ '— ' t^ 
 CMt^corv.NO 
 
 rf^r^CMO 
 
 Onio 00 On'^ 
 ^ OOCMOOO 
 
 ■"^ NO I— I t~^ t^ 
 
 t^Tf^NO'-i 
 
 CO lo tv. 00 o 
 
 NONdvCNdlNl 
 
 IT) NO OO 00^ 
 
 CO OMO ONCO 
 NOt^ t^ '— I CO 
 
 ooNOOr-r^ 
 
 OCOCM ONt^v 
 On"^ CO to cm 
 ioOnCM -^NO 
 ^ CM "^ lO NO 
 
 i< ^N.' ^sI t< t< 
 
 CMOr-HCMCO 
 
 oovnr^oot^ 
 
 ONNOlOI^ .— I 
 
 NO NO »-i in CN) 
 TfO'-Ht^OO 
 
 1^ CO 001^ NO 
 t^oqoNO»-t 
 t<t<t<odoc) 
 
 vo NO CM CO in 
 ■^ ONin CO NO 
 
 in T-i onono 
 
 CM t^ 00 IN. t^ 
 
 CJNrf-CM ONO 
 
 incoc?\^CM 
 
 mcoCM NC't- 
 CM NO CJn T- 1 CO 
 
 odododc?NON 
 
 inoOcoTfCTN O 
 
 CTN'^CMt^in CM 
 
 OnOnO'-hO O 
 
 NONOt-iNOON y-> 
 
 ONTfOOCMOO On 
 
 rj- NOcoCMin t^ 
 
 OOONOOinO Tf 
 
 Tf in NO t^ 00 oq 
 
 On On On On On On 
 
 Tj-lONOtN VO 
 
 inONOOO ON 
 OOOOCMtN 
 OQ OnOnNOio 
 00 CO 00 00 tN 
 00 Tt 00 CM NO 
 00 Tt OOCM "^ 
 CMint^OCM 
 
 QOOCTncoCM 
 CMOONOm 
 
 '— I Tf CO ONin 
 
 OOCM OnNO 
 T-HNOCM OnCJn 
 NO NO NO -rf CM 
 "<:*■ NO 00 O Csj 
 
 CM OMnONin 
 TfTj-r^CMO 
 "^OnOnOco 
 OOOrl-T-HOO 
 in »— iinCM CO 
 
 ^NOCOTj-OO 
 ONOCMtN '-I 
 
 "^ini^ooo 
 
 VONOVOt^tN tN.tNtNOO0O OOOOOOOOOn 
 
 CM rJ- n- rr CO 
 Ttt^OOmi-H 
 
 t^OOONCOO 
 ^t^OOON 
 CO CO In NC CM 
 NCOO-^inT-i 
 in 00 »-i com 
 T-; CM -?t in NO 
 On On On On On 
 
 OOtNTfCOtN 
 
 tNinO'-i 00 
 
 tNOCM ON'-i 
 OCMCM tN ^ 
 O OO Ont-1 
 CMOOOOOCM 
 NO Tt com o 
 tN CM NO On CM 
 On O O CD T-I 
 '-I CM CM CM CM 
 
 Ocoin 
 NO On CO 
 corto 
 
 CO"-^^ 
 
 NOCOi-H 
 
 comin 
 
 OVOOn 
 TfmNO 
 
 mo "^ 
 
 tNCO tN 
 
 OO CM 
 
 ■^O in 
 
 CM 00 00 
 
 C?nCM On 
 
 CTnOO -* 
 
 tNOO On 
 
 CMCMCMCMCNJ CM 
 
 ONOOtNNO 
 
 comm NO^N, 
 CO co»-«mi^ 
 
 coChm-"^ ON 
 Or^mNO'-' 
 CM OOcot^ T-i 
 CjNOOtNTt^ 
 CMinCO'-H rf 
 
 KtNtNOcJod 
 
 comocoTt 
 
 CVl OnOOCMOO 
 CO '-H 00 -"^f "* 
 '-^OOtNNOOO 
 NOCMmOO-^ 
 Tt-OOCMtNT^ 
 NOO'^MDOO 
 
 NOON r-;COm 
 
 00 00 On On On 
 
 00 1-1 -^Tf On 
 
 OOOOtNOCM 
 
 CO '-< NO '^^ »-H 
 tNincM On""^ 
 tNOVOWOO 
 CM comoOO 
 
 c?NONCorNTf 
 i^C?nt-h com 
 
 cKonooo 
 
 T-H,-iCMCMCM 
 
 tNin 
 
 OnconOOCM 
 comco cotN 
 
 ONOC7\'-iTt 
 O'^CMint-H 
 CM00r^ON■«^ 
 tNOOO'-'CO 
 
 O o i-J -^ 1-h' 
 
 CM CM CM CN) CM 
 
 CM00t>.C7N00 
 NO »-' ON CTn On 
 TfCMON'-'Tl- 
 OC^OOOO'-i 
 T-1 NO ■«:t NO in 
 CM 00 CO NO -^ 
 00 O Cvi Tt On 
 -rf T-H NO O CO 
 '-' OQ CM CO CO 
 CM CM CM CM CM 
 
 Tj- in NO On 
 CO 00 '-'in 
 
 oOT-i^r>. 
 
 O On cotN 
 rJ-comCM 
 OmoOlN. 
 OO'-'ONO 
 NO On r-; CM 
 COCOTt^-'Jt 
 CM CM CM CM 
 
 ON O 
 
 in o 
 
 in On 
 
 m On 
 
 CM CM 
 
 .-HNOtNOOco 
 "* tN T:t- t-H CM 
 
 lominoo "^ 
 
 '>?^tNNoooo 
 
 OCMOOCMNO 
 CMNOOOOQ 
 OncOnoCTnO 
 COtNO cotN 
 00 0(5 CJN On On 
 
 O '-'CM NOtN 
 '-' 00"^co00 
 .— I comt^C^N 
 NOOnCMOO C7\ 
 NO-^moTj- 
 OOO'-'CM 
 
 80NtNTfO 
 CMmoO'-' 
 
 rJ-'-i'-'OCM 
 
 cotNOotNO 
 
 C<l coCM 00'-' 
 t^ O 00 CO On 
 Ot-i CONOt^ 
 in On -^ CM CM 
 inCTN CONO 00 
 comOO OCM 
 ^' ^' r-^ CM cm' 
 CM CM CM CM CM 
 
 NO CO omo 
 cvi T-H 00 CM m 
 OOOtN"^"^ 
 m ,-c co"^NO 
 Tf o-rJ-CMin 
 
 On O ON On In 
 ""^tNOOOCM 
 CM CM CM CO CO 
 CM CM CM CM CM 
 
 IN CO CM NO"* 
 
 00 CM '-"-•NO 
 tN CO Tf On NO 
 ^incoTfCTN 
 NOOtNOOco 
 inrf Tft^O 
 mNOTi-^O 
 Tf-CM ONino 
 
 OOtNCO 
 NONOtN 
 
 COmco 
 
 OOl^O 
 NO IN 00 
 NO 00 NO 
 O'^co 
 
 Tfin o 
 
 inrj- m 
 
 i-iO 
 com 
 
 C3n CO m 
 
 tNOO in 
 
 CMTf NO 
 
 CM 
 
 mONcooooo 
 
 COrJ-intN NO 
 
 '-'OOin '-'NO 
 
 "sl- CM NO C?\ CO 
 rJ-TftNt^OO 
 
 OQOOm'-' 
 OOOONOCO 
 NO O COIN T-H 
 
 tNO'^CTNCO 
 O m "^in »— I 
 OCMm T-Hio 
 CMincoNO'-' 
 
 CM CM CM"* CM 
 tNCMt^CMOO 
 
 OOconoOnO 
 
 Tf 00 '-; * 00 
 
 '-^ '-I cm' CM CM 
 CM CM CM CM CM 
 
 t>.tN.OCOCM 
 
 0\ 0\CM '— ' On 
 T-f OnOnCM CO 
 
 tN ONinotN 
 
 tN CO CO ON CM 
 rj-CM '-^ '-'* 
 
 '-"-'OOOm 
 
 '-'Tft^ONCM 
 
 Ttr^co"*co 
 
 inooOMDON 
 CMCTvtNNONO 
 i-^^OOm 
 
 tNTtrNtNNO 
 
 OOmrJ-NO'-' 
 '-'tNCM ^O 
 mtNOCMin 
 
 NOmco 
 
 "*t^CO'-' '-1 
 NOCM NOOCM 
 tNTt-mOOrf 
 
 a\"*mcM CO 
 
 CMlNlNinCM 
 
 tNtNNOrj-'-' 
 
 inNoKodON 
 CM CM CM CM CM 
 
 00 in CO Tt 
 
 CVjTfO'-' 
 NOCO'-'t^ 
 
 CMNomo 
 
 00 t^'-'* 
 ^O'-'CM 
 
 OOCOO 
 tNCMNOO 
 
 ON CD d-H* 
 
 CM CO CO CO 
 
 CM "* 
 
 On CO 
 
 in in 
 
 in o 
 
 NO ON 
 
 CM 00 
 
 OO CO CM CM 
 CO CM CM CO'-" 
 r- 1 in NO CO IN. 
 OOOCM coo 
 comcooOTj- 
 OnOOOO NO 
 TfCOOOO 
 CM NO r-cin ON 
 
 CMinONO 
 OtNNomoo 
 
 •* '-"-'O* 
 CO CJN* '— ' CM 
 coCTnnOcoO 
 <7\ NO CO CTn * 
 CM NOO COtN 
 
 VO'-' CTnCOI^ 
 OONONOO 
 T-H ,— I omin 
 
 O '-' CM NOtN 
 '-' CTn O CO rf 
 00 NO NO 00'-' 
 tN OCM CO* 
 0*tNOco 
 
 ON'-irf*in 
 
 OOOmCTN'-i 
 CM CO 1—1 OCM 
 
 ^>.tNc:^ CO On 
 *m ctn CTNin 
 
 NO COCM * CTn 
 COCM OtN CO 
 NO 0\ CM * In 
 mm NO NO NO 
 CM CM CM CM CM 
 
 ciOON'-'mt^ 
 
 C^Nt^OO* 
 OnOOCvJ NOCM 
 
 NO NO NO NO In 
 
 '-I CVI NO ■* CO 
 tNin CM C50 On 
 On OC CM CM '-' 
 On T-i CM '-' CA 
 
 noocJoncdo 
 
 CM Cn) CM CO CO 
 
 OOOOOnOnt-i cm 
 
 inOsOOOtN CO 
 
 mOO*NO CM 
 
 m*rj-min •* 
 
 ctn C3N * '— 'in o 
 
 C?N(M ON OnQ r-> 
 
 O >— ' CO On O in 
 
 NOCMInt-^nO CTn 
 
 O'-hCMcO'* mvotNOOON Q'-"CMcoTf m NO In. 00 C7N omo^no inomcm o 
 cococococo cococococo ^■*"**'* ■***■■*■* mmNONOtN t>.ooocoNON o 
 
352 
 
 TABLES 
 
 Q 
 O 
 
 i 
 
 w 
 
 o 
 
 Q 
 
 w 
 
 w 
 
 w 
 
 H 
 H 
 
 
 O 
 H 
 
 H 
 O 
 
 3.^ 
 
 H 
 
 »-4 
 
 o 
 
 Q 
 
 o 
 
 t-t 
 
 « 
 
 00 
 CO 
 COO 
 
 ^ 
 
 :^ 
 
 ^ 
 
 t-ht-hOO COO\ 
 
 00 '-'00 CNJu-3 
 cou-jo O VO 
 
 Ttrooo 
 m t^ MD 
 
 On vOiO 
 -^-^^ 
 
 CO'— I o 
 
 »-«ooo ooooo 
 
 VO vo cot^ CO 
 t~^ Ov T— c CM U-) 
 
 00"^ t^oo VO 
 »J^ O 00 Tf CO 
 CM "-H Tf OiO 
 
 0\ O CM VO O 
 OOOOI^VO VO 
 
 ooooo 
 ooooo 
 
 VOOO t^ 
 t^u-) On 
 
 lO r-H l^ 
 
 lOlO ^ 
 
 ooo 
 ooc5 
 
 OOCNJ 
 
 O VO 
 OO 
 
 OO 
 
 do 
 
 cOcOt-HOOCNl 
 
 •-H CO VOCOOO 
 
 r^ t^ vo vocN 
 
 Tj- 00 rfON ^ 
 '— it^ vo vo On 
 On VO TiJ-Cvj O 
 
 CO CO CO CO CO 
 
 OOOOO 
 
 <d) (Z> <:5 d> d> 
 
 c^^lotN»co^ 
 
 ONt^xOOONC 
 lO 00 ^t^ T- 
 
 l^NOt^OOC 
 CM t^ COO 
 
 C^ t^ \OLO c 
 
 CM CM Cvj CV) r 
 
 poooc 
 
 OOOOco r-cvOiJ^CMO 
 
 tOiOON CMOnCM'OI^ 
 
 t>vTj-oo oxfo^'-H 
 
 co-rfr-i OcoOCOOO 
 
 TtONt^ CMiOiO-^Tj- 
 
 Tj-U-).— ( r-H t^ CO LO -— < 
 
 ONCM-^ ONmco^O 
 
 TfCOCM T-H r-l ^ r-H ,-( 
 
 icJdd ddc5cDc5 
 
 ooonovoo 
 
 VD -^-^ 00 CO 
 t^ NOt^ VOCM 
 00 CO ^I>s NO 
 CM '— ' tn Oio 
 O »— I cot^ "-H 
 ON 001^ NO NO 
 
 ooooo 
 
 CM CO 
 
 lO NO 
 
 00 NO 
 
 t^NO 
 VOOJ 
 
 U-J LO 
 
 OO 
 (DO 
 
 ONOCM 
 CO CM 00 
 
 or^-H 
 
 Tft^NO 
 
 c?NNor^ 
 
 CO ""3 CM 
 
 '^'^^ 
 
 ooo 
 ddcD 
 
 t^CM '-ir^co 
 
 O t^ CVl On CM 
 Cvi lO 00 o o 
 rl-r^CM t^OO 
 »-H t^NONOOO 
 Ol^iO CO 1— I 
 Tj- coco CO CO 
 
 poooo 
 cDoddczJ 
 
 ONTf OOiJ^T- 
 ONCOOOCMO 
 
 CO CM CM C^l O 
 
 CM r^ CO oc 
 
 ooor>xNOT 
 
 CO CM CN) CM r 
 
 ooooc 
 cDodcJc 
 
 Ot^to On^noO"^ 
 
 lONOt^ coOOOnOOtT 
 
 On Tt CO COLOr-HONlO 
 
 Tl-LOCM LOCM'—iO'-t 
 
 or^NO .— iioioLOLo 
 
 lONOCM CMOO'^NOCM 
 
 OnCM-^ OMO CO '-H o 
 
 T^COCM ^T-^T-^r-^r^ 
 
 ic)cDd d)d>d)di<:o 
 
 COTj-OtOt^ 
 
 m ON NO CO On 
 
 Nor^CJNOO ^ 
 
 CM t^iOT-iO 
 
 CO '— tlO T-i NO 
 
 '-'CMTl-OOCM 
 
 On CO t^ NO NO 
 
 ooooo 
 dddcDO 
 
 rv. CO 
 
 ^^ 
 
 lO o 
 CMiO 
 00 NO 
 t^co 
 mm 
 OO 
 
 dcD 
 
 Tf OI>» 
 
 00 '-it^ 
 
 OnCM r-H 
 
 NOOOO 
 
 ONt^t^ 
 
 ON NO CO 
 
 ooo 
 odd 
 
 CMt^ 
 
 NOTf 
 
 lOOO 
 
 '-H t^ 
 
 l-HOO 
 
 ss 
 
 ooo 
 
 T:f '-' r-1 
 
 l-HOO-H 
 
 coNor^ 
 
 NO NO 00 
 
 nOtI-CM 
 CO CO CO 
 
 ooo 
 
 rt roCJNtxV 
 
 Tl-CMONO^ 
 OOn coOnO 
 
 CM ovON oo^ 
 
 CM NO Cvi On b 
 '-C OnOOnOu 
 CO CM CNJ CM C 
 
 ooooc 
 
 ooo ooooc 
 
 lONOtN. CM 
 
 On-^co rf 
 
 CMt^CM '-H 
 
 NONOCO CM 
 
 NOLOiO '— < 
 
 u-jl^ CO CO 
 
 ONCM'* C7\ 
 
 TfcoCM '-' 
 
 NO ON CM CO 
 i_oio On '-H 
 CMOOJOO 
 CM CO TfiO 
 
 Loioiom 
 
 C?\iOt^ CO 
 lOCO "-I O 
 
 '-•OOO OOOOO 
 
 rf00t>xCOCM 
 
 CO CO r^ CO NO 
 
 too CO CM lO 
 t^ CO '— it^lO 
 
 CO CM NO'— I NO 
 C^J CO lO On CO 
 On 00 1^ NO NO 
 
 ooooo 
 
 OnOOcoCM ^ 
 CO to CM On NO 
 
 t^ONNO'^O 
 t^ CTn '-I Tj- CM 
 
 OONOOt^OO 
 
 OOTj-^t^Tt 
 
 I o m u-3 Tj- Tj- 
 
 ooooo 
 
 CM "^00 NO lO 
 
 CM NO CO On NO 
 
 »— ' "^NOt^lO 
 
 Ont-(U-)00 00 
 '-'OO NO NO 00 
 CM ONf^mco 
 rf CO CO CO CO 
 
 ooooo 
 
 CM OON '-•^ 
 
 m Not^mo 
 
 ONCMO'-''"^ 
 
 cmoonoon: 
 CM t^cM ONr~ 
 
 CM 00\WNC 
 CO CO CM CM C^ 
 
 ooooc 
 
 ooooo ooooc 
 
 CM NO 00 
 
 ONONt^ 
 
 t^CMTf 
 
 t^oo-^ 
 
 CMCOTJ- 
 NO 00^ 
 ONCM'^ 
 TfcoCM 
 
 id do 
 
 CM -H NO (N CM 
 COCM '-' ooo 
 On LO NO T}- On 
 OOCMmOOO 
 
 CO lOLOlO NO 
 
 '^ONOOOTf 
 
 Onno cO'-i O 
 
 00 Tt On NO CM 
 »—• 00 On coco 
 Tf- coOnOco 
 CO On t^*-^ CM 
 rl-CM NOCM t^ 
 cOTfNOO'^ 
 
 OOOOO OOOOO 
 
 NO CO 
 COO 
 
 rt-NO 
 CJNt^ 
 CMO 
 vom 
 
 OO 
 
 Nooot^ 
 
 NOt^^'^f 
 ONIJ^OO 
 
 t^ ot^ 
 
 ococo 
 CM oom 
 
 OOO 
 
 rro 
 
 lOtO 
 
 n-No 
 
 CM 00 
 
 COO 
 
 OO 
 
 COt^ T— I 
 
 coOrJ- 
 OCOCM 
 
 OO^'^ 
 CO CO CO 
 OOO 
 
 lO NO I\ 00 Oj 
 "^ On CM O M 
 
 CO .— t IT) r-l 0> 
 
 NO CO '-I O bi 
 CM t^ coOb 
 co^ OONb 
 CO CO CO CM C 
 
 OOOOC 
 
 .-•t^CM ^'-iCM'^iO 
 
 rJ-'-«0 •-• CO r^v-* ID 
 
 Tf'-i'-i CMcoOOcoO 
 
 OO^ NOcoOOcot^ 
 
 OOCMCO OiOiONONO 
 
 VOCTnlo uO'— tt^ONLO 
 
 ONCM-^ CJNNOcO'-iO 
 
 TfCOCM ^r-lT-H,-!,-! 
 
 ococo _ 
 
 CO 00 00 T— iiO 
 ONOiOCM O 
 
 to CO r^ CO 00 
 ■^ LO r>» T-H IT) 
 
 ONCOt^t^NO 
 
 ooooo 
 
 NO CM CO On 00 
 Tj-r^CM t^rr 
 
 NO NO O ■'^LO 
 
 CM '^noOOlo 
 ooo T-toO On 
 
 ,-H NO COCTNNO 
 NOLOLO Tj- tT 
 
 OOOOO 
 
 On 00 00 NO lO 
 
 CO -^ CO NO NO 
 
 or^ CM NO NO 
 
 CM CO t^ On 00 
 CO ONt^r^ On 
 
 "Tf »— ' ONt^LO 
 
 rl" -^ coco CO 
 
 OOOOO 
 
 r^ONt^fOo 
 
 ■<*CMt>.VOC* 
 
 CMivsNor 
 
 CM 00 NO' 
 
 cor^ coOo 
 
 '^CM'-'OO 
 CO CO CO ""^ 
 
 ooo< 
 ddd<5c 
 
 Tj-'-iO\ Ot^COONNO 
 
 Tt '-< O OOCOCMCMCO 
 
 CMCM-H OnOOOOOO 
 
 ^ CM 00 co-^CMC^NTj- 
 
 voOCM OLONONOt^ 
 
 t^ONO NOCMOOONO 
 
 Onco-"^ OiNOcoCMO 
 
 rj- CO CM ,-1 r-H ,-4 »-H ,— ! 
 
 iddd <od)<Z)d>d> 
 
 00 00 ON CM l^ 
 
 o ot^oo »-" 
 CM T^ 00 '^j- '-< 
 
 COLO-'^'-'O 
 LO "^ 00 -^ On 
 
 LO NO 00 CM NO 
 
 ONOor^t^NO 
 
 OOOOO 
 
 <Z) cS CD <d> d) 
 
 OOONOlolo 
 tN^NOOOt^ 
 CO'^OOCM r-H 
 CM -^moOLO 
 '—1 ON CM On O 
 CMt^'^OCO 
 nOlololo rf 
 
 ooooo 
 c5d)<:6<od> 
 
 '-iioCMTj-t^ 
 
 cor^t^oorj- 
 
 LOO COLO CO 
 
 '—I CO NO 00 t^ 
 ""cfOOOCOO 
 LO coOCOt^ 
 rl- -rf rf CO CO 
 
 ooooo 
 
 5i 
 
 loooco , ^ 
 r^ooLo-^c 
 
 Nooom^ij 
 
 ONOTj-NC 
 '^OOTfiFHC 
 LO COCM '-'C 
 CO CO cococ 
 OOOOC 
 
 mNOt^00C>> OOCMCO"* lONOt^COON O'-iCMcOrJ- iT) no t^ 00 C 
 ^^^^^ ^^^^^ CMCMCMCMCM CM CM 04 CM C 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 353 
 
 txON00O\M3 
 t^ CO ^iT) O 
 iv. t^t^ 00 o 
 
 ooooo 
 
 000C)0 
 
 oooooc^in 
 to U-) On r-H ,-( 
 
 LO»— I OOVO 
 
 oor>. vovoio 
 
 covo vooot^ 
 
 CVJOOt^OOCO 
 
 COVOOq r-H CO 
 
 00 CM t^ CM r^ 
 TfTfCOCOCNJ 
 
 CVJVOON 
 
 VOCMO 
 
 ^^^oO'<:^ 
 
 On 00 
 
 ON'* 
 to CO 
 OCM 
 
 r-to 
 
 ooooo 
 doodo 
 
 ooooo 
 
 ooo 
 
 oo 
 dd 
 
 vOONOrOCVl 
 
 O '— ' "^ ^ »— ' 
 
 oOTj-coTj-r^ 
 lomioooON 
 
 CNJ VO COCNJ CO 
 
 ooot^vom 
 
 •-H OOOO 
 
 ooooo 
 
 ooioo 
 
 tOOr-H 
 
 covoco 
 lOCM On 
 vOOtT 
 
 Tf ■* CO 
 
 888 
 
 odd 
 
 0\V0 00 
 ooo 00 
 
 OOt^ '-H 
 
 CO-"* T-l 
 O^O CO 
 COCN CN 
 
 OOO 
 
 ooo 
 
 Tfoiorgio 
 coco^cviio 
 ONCN -^r^vo 
 Onu-j t^vo On 
 
 NO vo vor^ 00 
 
 COCM r-H O On 
 
 CM eg (N eg ^ 
 
 ooooo 
 
 '-H CM CO CO CO 
 CO CM rj- ir> Tj- 
 
 rN.io vot^to 
 
 00 CM OCMOO 
 O COVO ONCM 
 0\ 00 t^^^ 
 
 ooooo 
 d>d>d>cid) 
 
 OOt^Tj-Tt T-H 
 
 COOONOVOO 
 tN.Oco C0C7\ 
 
 rv. OLO coco 
 
 <0 '-tu^ OiO 
 lO lO Tj- Tj- CO 
 
 ooooo 
 
 lO'-it^NCOON 
 
 OCMOcot^ 
 OOChi-HCM T-H 
 
 vor-Ha^ooc^ 
 o vD '-<r>»co 
 
 coCMCMi-n-H 
 
 ooooo 
 cf>d>cidic> 
 
 vOOrooOOO 
 cooocot^io 
 
 00 "* to 00-* 
 
 i-ir^cocM o 
 
 O coo CAO 
 '-•C^NCO vovo 
 t-H OOOQ 
 ooooo 
 
 lOt^OO 
 
 lO cot^ 
 CM ^0\ 
 CMiO C7\ 
 lorj- CO 
 
 ooo 
 ooo 
 
 VOOO Th 
 
 CMt^ ON 
 
 1— I o to 
 T-i Ov Cvj 
 
 too r^ 
 
 coco CM 
 
 ooo 
 ooo 
 
 d>ci d 
 
 CM to 1-1 CO t^ 
 
 CTncovOiovO 
 OnvOO'OOO 
 Tf On —I 00 >-• 
 VOiO^ VOOO 
 rJ-coCM '-lO 
 CM CM CM CM CM 
 
 ooooo 
 (DcSddxD 
 
 T-<iO00t^'«* 
 CM 00 i^"^'-' 
 CM CM VOO'-" 
 OcoOCMt^ 
 OCM lOOO '— ' 
 OC7\00t^t^ 
 
 ooooo 
 c5d>cicic:> 
 
 lOOOC^iCO^ 
 t^OOCM OOn 
 lo T-Hi^ On t-^ 
 lOt^ '-H 00 00 
 to ON Tj- 00 CO 
 
 vo^J^toT^ rj- 
 
 ooooo 
 ddddd 
 
 CMCMCMTfvo 
 
 VO'* ON 00 ON 
 
 On cot^ T-' CO 
 QtO 1— I O O 
 0\Tt OVOCM 
 CO CO CO CM CM 
 
 OOOOO 
 
 »— • t^ tN. Tf in 
 
 CM coC^vCM NO 
 
 CO CO r^ NO t^ 
 CMtTNOCM vo 
 
 00 '-'t^ NO NO 
 
 i-iOOOt^^ 
 
 r-H r-H ooo 
 
 OOOOO 
 
 00^^ 
 Ot^CM 
 to O CO 
 
 to NO NO 
 
 oO'-^in 
 
 lOlOTf 
 
 ooo 
 ooo 
 
 odd 
 
 CMCM Tj- 
 
 o o t^ 
 NOVO CM 
 "^ 0\ o 
 OLO CM 
 Tj- CO CO 
 OOO 
 OOO 
 
 OO 
 
 lOioCM On CO 
 
 r^O'-<t^ NO 
 ONOoor^co 
 
 CMt^t^Ttt^ 
 
 NO to to NO t^ 
 
 lOTtcoCM '-H 
 CM CM CM CM CM 
 
 OOOOO 
 
 <:5d>d>c>c> 
 
 CMt^t^OON 
 
 00 OtoONC7\ 
 OtoCM ONCO 
 to t^ Tl- "Tj- C3N 
 On— irM^O 
 
 OOOnOOOO 
 CMCM ^ '-ht-i 
 
 OOOOO 
 
 c>>ot^Noo 
 
 Ot^iOVOt-i 
 CM'-hOvoOO 
 
 r^oocvi 00 1^ 
 
 Tj-OOcot^CM 
 t^ NO NO to to 
 
 ooooo 
 
 '-I CO NOON Tj- 
 
 CM Tt CO NO CM 
 
 coOOOto 1— • 
 ON CO 00 NOVO 
 t^coOOTfO 
 'et Tj- CO CO CO 
 
 ooooo 
 dic5ci<oci 
 
 ^ONOCMO 
 CTNCMCOtoco 
 CO'-' CO ON ON 
 
 t^ NO to r^ 00 
 
 NO CJn to CO CO 
 CM O C7\CX)I%. 
 
 ooooo 
 
 Ocoto 
 t~v.ONr^ 
 
 to O CO 
 
 Tt-CM CTn 
 tOOO'-H 
 NO to to 
 
 ooo 
 ooo 
 
 ooooo ooo 
 
 Orf O 
 NOrf (50 
 f^ON 00 
 
 Tl-NO Tf 
 NO'-H tX 
 '^Tl- CO 
 
 ooo 
 ooo 
 d>c5 d 
 
 OnOO-^On 
 '-^co^Tj-OO 
 
 cor^t^Tt-NO 
 
 NO to to NO t^ 
 NO to Tj- COCM 
 CM CM CM CM CM 
 
 ooooo 
 
 coot^coco 
 
 NO^t COi— I NO 
 
 COCM '^ NO"* 
 
 CO to t-H r-H to 
 
 (?nt-h Tj-r^ o 
 
 '-"-iOOnOn 
 CMCMCM r-i ,-H 
 
 ooooo 
 
 ONONOIOOO 
 r-l OCM NO CO 
 t^r- Tt TtO 
 
 CM CONOCM >-• 
 Tt-OOCM t^CM 
 
 OOt^t^NONO 
 
 NOtoCMOCO 
 f^CMTl-Ot^ 
 
 ON^HCOtO-*- 
 r-H tOOt^NO 
 
 r^ CM 00 CO ON 
 
 lOtO"*""* CO 
 
 OOOOCOtMO 
 
 NO '-H ■* Onco 
 
 ooooo 
 
 d>CDd><0<D 
 
 ooooo 
 
 to CX3 CO >— I »— I 
 
 cO'-i O O\00 
 
 ooooo 
 
 CMCMVOcO'-H r^ 
 
 t^ COON ^-H 00 to 
 
 OOOCO'-H NO o 
 
 O'^C^NCM '-H t^ 
 
 cotoOOcoOO CO 
 
 r>vNO tOlO Tj- Tj- 
 
 88888 8 
 
 dxz^dc^d d 
 
 "^CMt-inOI^ 
 
 to T}- ON 00 00 
 00 ON l^ t^ CO 
 
 t^oo^oo 
 
 NO NO NO NO t^ 
 t^ NO to ""^ CO 
 CM CM CM CM CM 
 
 ooooo 
 
 ^COO 
 
 »-H cor^ 
 
 i-ctoCM 
 to NO CM 
 CA ^ rf 
 CMCM '-H 
 CM CM CM 
 
 ooo 
 
 CO to 
 
 00 NO 
 On CO 
 
 r-H to 
 
 t^O 
 
 oo 
 
 CM CM 
 
 oo 
 d>ci 
 
 »-<CONONOt^ 
 T*NO ONOtO 
 r-lOON-^tO 
 
 CMCM Tl-OOO 
 
 n-oocMt^'-i 
 
 ONOOCOt^t^ 
 
 CM to NO to CO 
 
 '-Ht^Ot^NO 
 Q^-* OtO 
 0\ ^ NO CO'— I 
 NO CVl t^ CO ON 
 NONOtOtO "* 
 
 CO to CO 00 "-I 
 
 NO Tj- On NO"* 
 t^'-i C7NCM c^ 
 
 i-itoooNo '-" 
 
 ^^^^^ ^^^^^ ^^^^o 
 
 ooooo OOOOO OOOOO 
 
 ooooo 
 d>dd>cic> 
 
 ooooo 
 (Oc5d><5c> 
 
 ooooo 
 
 lOCMOOVONO 00 
 
 CMtoOTt NO CM 
 
 CO NO 00 >-< CO Tj- 
 
 CM Tt-Nor^Tj- t^ 
 
 '-I CO NO Oto O 
 
 001^ NONOtO to 
 
 88888 8 
 
 ddddd d 
 
 »-< CO C?\ Tl- t^ 
 
 '-I t>. 00 Tj- ON 
 OOtOOt^ON 
 Tft^t^CM CO 
 
 t^ NO NO t^ 00 
 
 cor^ NO to Tf 
 
 CM CM CM CM CM 
 
 ooooo 
 ddddd 
 
 OO^iOOQ 
 NOcoOtO VO 
 
 CO-^OO'-H t-H 
 
 O '-•NO NO ON 
 OCM'^-t^O 
 Tl- COCM '-"-" 
 CM CM CM CM CM 
 
 ooooo 
 ddddd 
 
 OCM cot^'-i 
 
 NOONOCOTf 
 
 to »-• tot^ ■*■ 
 
 to to t^ CM O 
 
 n- 00 CM t^ CM 
 
 OONONOOOO 
 CM -H^^^ 
 
 ooooo 
 ddddd 
 
 lOtOl-lrt■r^ 
 
 ot^'-ioor^ 
 
 tOt^ '— I CO ■*" 
 
 OCMl^co '-" 
 r^CM t^ CO On 
 t^ t^ vo NO to 
 
 ooooo 
 ddddd 
 
 CO t^ to t^ CM 
 
 t^ CO-* NO 00 
 CM NO Tj- NO CM 
 '-I CM -^CTn CO 
 tot^ CM On C^ 
 
 to COCM o c^ 
 
 '-I —t '-"-•O 
 
 ooooo 
 ddddd 
 
 On to 00 
 
 ooQC^ 
 
 NO 00 ON 
 
 OCM to 
 
 ONCX)t^ 
 
 Soo 
 oo 
 odd 
 
 NOl-l Ti- 
 
 CO to to 
 
 OtO NO 
 
 ON CO 00 
 
 NO NO to 
 OOO 
 
 oo o 
 
 dd d 
 
 Oi-iCMCOTf lONOr^OOCTN O'-<CMC0Tf 
 CO CO CO CO CO CO CO CO co co ^ ^ ^ ^ '^ 
 
 tONOt^00C3N OtoOtoO tootooto 
 
 '*'*'^'*'«* totoONotv. ^N0000ONON 
 
354 
 
 TABLES 
 
 
 
 
 ON'-hON 
 
 OcO(M'<:f -^ 
 
 VO rl- CO r-H ,-4 
 
 vOTj-O-rfvO 
 
 mdlo r^oo o 
 
 CM LO r>«. to 1— t 
 
 
 
 
 oooo-=i- 
 
 Tf vOOON<M 
 
 OnOn Oi-i On 
 
 r^ l-H OOLO 00 
 
 lOLO LO Tf o 
 
 Tf-rfLOOO On 
 
 t^ CO '-^ LO NO 
 
 
 
 
 VOOn^ 
 
 VO CN) to lO C<l 
 
 i>.rsir^O'^ 
 
 CMCMTf-voo 
 
 NC^t^OslON 
 
 
 
 
 COOC^ 
 
 C>>VOCOCOCNl 
 
 VO OM^ MD CO 
 
 voLorrLocg 
 
 OO O TM^t^ 
 
 CM o OA ON r>s 
 
 
 
 ^ 
 
 Tj- i-HLO 
 
 CO CO T-H oo 
 
 oor>.CM ONLo 
 
 On ONTj-co^O 
 
 1-hOOCM^ 
 
 CM On NO LOlO 
 
 
 cT 
 
 10-^00 
 
 t^co 0\'— 1 1^ 
 
 LOVO OnCNII^ 
 
 CM OOLO CM On 
 
 r^Lo CO l-H c?\ 
 
 00 NOLO Tf CO 
 
 
 VO 
 
 00 ^CNl 
 
 tv.^T-|O00 
 
 t^ ^OLO LO -rj- 
 
 "^ CO CO CO CM 
 
 CM (M CM CM '-H 
 
 
 
 o 
 
 
 .Tj-cocvi 
 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 
 a 
 
 
 ^ooo 
 
 d>d>d>d>d> 
 
 <5d>d><:5d> 
 
 d d c3 d o" 
 
 <:5d>d>c5<5 
 
 d>d>d>c^d> 
 
 
 P4 
 
 
 OOiOOO 
 
 ot>>.rvi^oo 
 
 00 o^l-Hr^^s. 
 
 C?M-H Tj- CM »-• 
 
 On ^ l-H CM O 
 
 NO CM NO CO T-t 
 
 
 
 
 00 Tf ooooo 
 
 Lo00Tj-r>.ON 
 
 CM On ^ Cvi o 
 
 LO l-H LOCO On 
 
 Tl- CO OO LO lO 
 
 
 
 ■^ 00 1 — 1 
 
 T|-l^O\-HO 
 
 Tj-OOLOLO CO 
 
 CM OnOn^lo 
 
 CM VOONO O 
 
 CM "^ 1— ' CNJ VO 
 
 
 
 O O '— ' 
 
 r^ »-< '-H c\j c^ 
 
 OOOCMloCV) 
 
 Tf VO ON Tf -rt- 
 
 -^^ ONt^cot^ 
 
 LO NO On CM "«}■ 
 
 
 <:5 
 
 OOCNIO 
 
 OnOOOI^vO 
 
 iOCOOOtJ-O 
 
 CO CM NOLO r^ 
 
 <M ON c:tn T-H Tt 
 
 On LO CNj ,-H o 
 
 
 w 
 
 t^t^CM 
 
 Ot^CN^O 
 
 0\OCM VOi-H 
 
 MD CM OOLO CM 
 
 Of^LO-^CM 
 
 O On X t>»NO 
 
 
 OO'-HCO 
 
 00 Tl- (MOON 
 
 t^r^ vololo 
 
 ■rt-^ coco CO 
 
 CO Cvi CM CM CM 
 
 
 
 
 
 Tj- cocg 
 
 r-i^^^O 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 
 o 
 
 
 T-^dod 
 
 d>d>d><:5d> 
 
 d>d>d>d>d> 
 
 c5d>d>d>d> 
 
 <:Dd>d>d>d> 
 
 cid>d>d>(6 
 
 
 Q 
 
 
 vovoio 
 
 TfONt^lOt^ 
 
 <N00 ONLOCNI 
 
 1— it^OO Or}- 
 
 ■^r^inoNco 
 
 cor^NO^»-M 
 
 
 w 
 
 ^ 
 
 lOCOMD 
 
 ^cOTj- vo-^ 
 
 00 '-H l-H coco 
 
 CC CO LO ON CO 
 
 i-HioNOrJ- O 
 
 O CO Tf-OOVO 
 
 
 t^ COCO 
 
 -•OO-^CATJ- 
 
 CO 00 VO LOO 
 
 CO LO i-^ vo r^ 
 
 vooLoc<ir>. 
 
 On^OnO^ 
 
 
 
 ;?2 
 
 ONt^Tj- 
 
 OM^ OOt^ 
 
 t>»cox^\ou^ 
 
 t^Tf\OJ>sC\l 
 
 l-H l-H l-H coo 
 
 r>. O"^ooco 
 
 CO CM ^Cg l-H 
 
 
 w 
 
 ONt^r^ 
 
 COCVI VOCM OO 
 
 l-H OTj-CM Ti- 
 
 00 VDlovOOn 
 
 ^ Ot^LOrJ- 
 
 
 ^i- 
 
 00 00 CO 
 
 C^OOtJ-vOCN 
 
 -H CM rf 00 <N 
 
 ooTfor^^ 
 
 l-H CTn t^lO CO 
 
 CM -H ON00t>x 
 
 
 w 
 
 
 00-^ CO 
 
 OO^i-CvlOON 
 
 001>. VOLOLO 
 
 Tt- Tj- Tj- CO CO 
 
 CO CM CM CM CM 
 
 CM CM '-' ^ '-I 
 
 
 ^ _ 
 
 
 .Tt tOC^l 
 
 ^^^^o 
 
 OOOOO 
 
 ooooo 
 
 OOOOO 
 
 OOOOO 
 
 
 
 "-^diQd) 
 
 o c5 o" c5 d 
 
 d>d>d>d>d> 
 
 c>c5c5d)d> 
 
 d>d>d>cSd> 
 
 d)d>d>d>d> 
 
 c^ 
 
 
 
 o5)0 
 
 ^0-Hf0 0\ 
 
 Tj- rj- t>^ CO t^ 
 
 OOCM coCM 
 
 lOl-H l-H VOCO 
 
 vooOTj-ooeo 
 
 
 
 
 -hONVO00O\ 
 
 onOi— ir^ON 
 
 l-H OLOCONO 
 
 t-^i-HOOOCO 
 ■■-H OCOOnMD 
 
 ON COLO OnCJN 
 
 H 
 
 
 ^^s 
 
 t^ r-l ONl^CNI 
 
 
 l-H OOOCOOO 
 
 l-H t^ 00 CM On 
 
 < 
 
 
 CNJ VO OCM On 
 
 ON ^ LO ^ VO 
 
 Tj- CM On On CO 
 
 COCOOnOOO 
 
 l-H NO CO l-H tN, 
 
 {fX r. 
 
 ^ 
 
 1—* CO '^ 
 
 vOt>^ vQiO-^ 
 
 
 O\00 ^ On T-H 
 
 lOCN '— 1 COLO 
 
 OLoCslOOO 
 
 l-H O 
 
 OOlo 
 
 'f o ^oo"^ 
 
 CO-^OO"^ 
 
 ONLOCM OOMD 
 
 CO^ ONt^LO 
 
 Tf-CM^OOO 
 
 P-. 
 
 -* 
 
 OnCVJ CO 
 
 00 LO C^l o o\ 
 
 oor^ vo voLo 
 
 rj-rj-^coco 
 
 CO CO c^j CM r^i 
 
 C^J CVl CM CM »-" 
 
 
 ^TffOCM 
 
 ^^^^o 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 
 
 r-^d>d>d> 
 
 ddddd 
 
 d><:5d>d>ci 
 
 d>d><zSd)d> 
 
 <d>d>d><5d> 
 
 d>c5<z^d)d) 
 
 > 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 w 
 
 K < 
 
 
 OnoO'* 
 
 1>»^ONLOt-< 
 
 tv.t^iot^ro 
 
 t^ ^Ti tn -rt- t^i 
 
 OOONt^Oro 
 
 '^O'-'inco 
 
 >_J 
 
 u 
 
 
 
 coCNTt^O 
 
 coONONtor^ 
 
 O 00 '-H CO CO 
 
 OLOOOOOO 
 
 O'^'Tj-NOCO 
 
 pq 
 
 •^ J 
 
 
 o com 
 
 ^OOTif^'O 
 
 ^ ,—1 CO l-H o 
 
 LO '^ CO vo O 
 
 l-H \OCMOOCM 
 
 rJ-LOCMCMLO 
 
 K -] 
 
 ^ 
 
 oovc^r^-^ 
 
 Ti-ONOO^r^ 
 
 (M 00 Tf r-H T:f 
 
 NO CO CO l-H t^ 
 
 t^OLOOTf- 
 
 < 
 
 TfONCNJ 
 
 ■^ \0 >-0 "'^ "^ 
 
 CNJ 0"^OLO 
 
 LOMD OOCN VO 
 OOt^ VOVOLO 
 
 OO^OCO On 
 
 cOOOnO CM 
 
 NO CNl 00 NO ^ 
 
 H 
 
 ^^ 
 
 ^ 
 
 
 VOCM OOO VO 
 
 -Ht^Tj-Ot^ 
 
 lOCOOCM^ 
 
 LOTi-CM-HO 
 
 On CO CO 
 
 OOLOCM '-' 0\ 
 
 LO Tj- Tt rt CO 
 
 CO CO CO CM CM 
 
 CM CM CM CM CM 
 
 
 CO 
 
 -^COCM 
 
 1—i T— I ,—( l-H O 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 
 
 
 r-^d>d>d> 
 
 d>d)d>c5d> 
 
 d><zic^d>d> 
 
 d>d><:5cid> 
 
 <z>c5>d>d>d> 
 
 d>c5d>d)d> 
 
 
 
 '^^O^JO 
 
 t>sOlOO^ vo 
 
 '-iLOONTh^ 
 
 LOTtOLOCO 
 
 OOLOCOOOQ 
 
 LOOOLOt^OO 
 
 r-HOOONOCM 
 
 
 !z; 
 
 
 00 coo 
 
 lO to CO CO 00 
 
 t^ t^ CO On •^ 
 
 00CN|CM(MVO 
 tv.OOrfcO'^ 
 
 
 ^ 
 
 
 oot-^ 
 
 tM^vo^co 
 
 Ot^CN On^ 
 
 VOOCM 00 CO 
 
 LO^ t^ COt^ 
 
 
 
 '-I co(M 
 
 lO ONOLO CO 
 
 cor^ vocM eg 
 
 VO-^LOO-H 
 
 l-H r^ xt- l-H -^ 
 
 CM CO NO ON »-H 
 
 
 < 
 
 
 vOloo 
 
 COIOIO'^''^ 
 
 CM O-Tj-OLO 
 
 t^vo ONi^co 
 
 CM OOt^ OOO 
 
 Tt ONLOCM»-t 
 
 
 ^ 
 
 C<lcoON 
 
 OO^OCMCO 
 
 r^ooo'^oo 
 
 CO ON LO CM ON 
 
 t^TTCMOON 
 
 t^uT^coCM 
 
 
 
 0\CN> CO 
 
 OOiOcO'— 1 ON 
 
 oor^t^ vOLo 
 
 LO "^ -rf T}- CO 
 
 CO CO CO CO CM 
 
 CM CM CM CM CM 
 
 
 « 
 
 CO 
 
 .^COCNl 
 
 ^^^^o 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 OOOOO 
 
 
 o 
 
 Q 
 
 
 y-*d><z^d> 
 
 d)d>d>d)d> 
 
 d>d)d>d>d> 
 
 d><:5d>(od> 
 
 <D<5d>d>d> 
 
 d>d>d>d)0 
 
 
 
 ipcOON 
 
 Cv) CO t^ LO m 
 
 CMONr-^CMt^ 
 
 t^OvOcoCM 
 
 cOt-<OOco 
 
 t^ NO NO 00 to; 
 
 
 
 CMT:^lO 
 
 cO00rfO\ON 
 
 t^CMt^LOLO 
 
 
 tv.TtM--HMD 
 
 CJN l-H t^ CO CO 
 
 
 Ph 
 
 ^ 
 
 00 (N O 
 
 ooot^r^o 
 
 OnVOOOCM -^ 
 
 On t~>« l-H o 00 
 
 '-HONNOTJ-OO 
 
 On 1-Ht^r^ON 
 
 
 l-H COCN) 
 
 ONt^ ONLO t:}- 
 
 cooo^cocg 
 
 LO 0\ COCOf^ 
 
 
 cOTfLOt^OG 
 
 
 
 ^ 
 
 rqcoON 
 
 CMuT^^rf 
 
 CM O^OLO 
 
 t^LO On ^t^ 
 
 1-HOOVOt^ON 
 
 coco-^-Hc:rN 
 
 
 o 
 
 COT;J-a\ 
 
 Onlo 1— 1 coo\ 
 
 00 On^loOn 
 
 oot^r^ voLo 
 
 ■"^ O ^coO 
 
 OOLO CO '-H ON 
 
 OONOLOTj-CM 
 
 
 ^ 
 
 C<1 
 
 0\(M CO 
 
 OOLO CO^ o\ 
 
 LOLO T^ Tj- Tj- 
 
 CO CO CO CO Og 
 
 CM (M CM CM CM 
 
 
 Tf coCN 
 
 
 OOOOO 
 
 ooooo 
 
 OOOOO 
 
 OOOOO, 
 
 /"N 
 
 g 
 
 in 
 
 
 '-^dcJd 
 
 cDd>d>d>d> 
 
 d>d>d>d><z^ 
 
 d>d>d>d>d> 
 
 d><5d>d>c^ 
 
 d><od>d><^\ 
 
 00 
 
 en 
 
 O 
 
 ^CSICO"^ 
 
 lOVOtxOOON 
 
 OT-iCMrOrJ" 
 
 lOVOI^OOOv 
 
 O^CMCO'^t 
 
 lovorvooON 
 
 CO 
 
 
 
 
 T— t t— < T-< T— 1 T-< 
 
 »— 1 1— 1 »— 1 1— ( »— t 
 
 CM CM CM CM CM 
 
 CMCMCMCvlCM 
 
 609 
 
 
 p^ 
 
 
 
 
 
 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 355 
 
 OnCVI roONTt 
 OOCN (VI (Nl 00 
 
 CVl ^ — <OC7N 
 
 ooooo 
 
 OC>OOCJ 
 
 ooooTf^r>^ 
 coTt-r^ooco 
 t^ OMOu^ On 
 
 On coco ro 00 
 
 oooot^r^ vo 
 ooooo 
 ooooo 
 
 OOCJOO 
 
 TtvOCMCM vo 
 
 inoo-^ ^ o 
 
 '-H OOcorO VO 
 VOLOOO ro O 
 Tto^<^0 
 
 ,VO ^ LO VO lO 
 
 ooooo 
 
 OOOOO 
 
 ooooo 
 
 Omoovo vo 
 to 00 VOvQiO 
 
 o -^t^t^ fO 
 
 O'-HTt-ON^ 
 
 ooooo 
 
 oworvi vofo 
 
 CVJ Ost^vO'-i 
 Tf \Ovo OfO 
 tT cot^ ONfO 
 TfiOOOcoO 
 
 roCM ^ T-._ 
 
 ooooo 
 ooooo 
 ooooo 
 
 r^rf^vooo vo 
 voiooofom fo 
 oocvj vooot^ r>^ 
 
 VOt^C^ T-H CO t^ 
 
 80Q00 
 ooo ~ 
 oooo 
 ooooo 
 
 Tf CM rvj Tjr to 
 
 »-iCMOOiO 
 
 »Oco00O\»O 
 
 O^CVjTtt^ 
 
 lO Tf CO eg >-• 
 
 '-"<oo\<^rM 
 
 t^Tft-xCVl\0 
 '-1 ''I- ON -"^ Tj- 
 
 IN» corOOO ^ 
 OTfCOCvit^ 
 '-1 OOnOnOO 
 
 OOOOO ooooo 
 
 ooooo 
 ocJooo 
 
 voOn'— irom too T-ir^\n rfvoootoio »— i rvj vo »- ' fO 
 
 ^CN)r>vco(vj t>v(Nirvj'rfvo r>.00'-i^^ vo^i— "-'O 
 
 OOCM-^roNO '-'OO'^OOOn vo nO 00 ON On ^ On ro rv Q 
 
 r^CMONON^ vocMt-H^co t^NOCMOOON cgcMOCMOv 
 
 CVJOOcoOnvO CVJONVOcoO t-^VOOO'-'^ fOOOOvOTt 
 
 OOt^t^NONO "^ \J-) xn xn in tj- ro CN CM »- 1 
 
 ooooo ooooo ooooo 
 
 ooooo ooooo ooooo 
 
 ooooo ooooo ooooo ooooo ooooo o 
 
 TfvoOfO'-H 
 tOTt CMioON 
 '-'fororr^ 
 
 ONTj-NO'<^00 
 COTflOt^ 0\ 
 VOlOTf COCVJ 
 
 ooooo 
 
 OOOCJC) 
 
 lOOOCMONt^ 
 ''^•t^O vo NO 
 OiO -^ .— iirj 
 
 i>.O00OiO 
 CM VOONTf 00 
 CM -hOOOn 
 
 ooooo 
 c> o o o o* 
 
 lOOOOOiOi-t 
 
 »-H lO VC fO t^ 
 CO '-I 00 CV) o 
 '^NOOOOOO 
 ro CO Tj- On «-0 
 On oocot^r^ 
 
 OOOOO 
 
 CM '-H"«^OOCM 
 
 O r^ foio CM 
 
 CM rft^OOt^ 
 
 OTf ooooo 
 
 CM OOiO— '00 
 t^ vo NO ^«J^ 
 
 8 oooo 
 oooo 
 dddoo 
 
 iOTj-vorx'-< 
 
 r-HloCM Tfr^ 
 
 CM t^ -"^ OiO 
 
 O OO^^fO^ 
 
 NO fO"^tN. 1— ( 
 uo Tl- fOCM (M 
 
 ooooo 
 
 Tj-O\rj-V0 a\ o\ 
 
 O VO CO '-' On CO 
 
 '-C O CO fOt^ 00 
 
 CM l^ ONt^ ON lO 
 
 r>Nfoooovo lo 
 
 ooooo o 
 
 ooooo o 
 
 c5<ocSc^(zi d 
 
 OiOO\t>.t^ 
 .-. coioirjt^ 
 O^OOO cOTj- 
 coiOTj- O '— < 
 
 00 00 On ^ CO 
 
 t-^ NO VOIO -^ 
 
 ooooo 
 <:5<od)d><:D 
 
 CM 00 tN. CM fO 
 
 rooOioO\00 
 r^ voon •-I o 
 
 t^OO fO CO NO 
 lOOOCM no O 
 CO CM CM '-"-I 
 
 ooooo 
 
 ONOOOONTf 
 Tj-fOCM OOiO 
 fOt^ O OntJ- 
 
 CM '-I n-ooNo 
 
 to 0>J-) C NO 
 OOONONOO 
 '—'-^ OQ O 
 
 ooooo 
 
 VOIO OnioCM 
 
 TfOOONO'-H 
 CM CM r-OI^ 
 NO 00 CM 00 vo 
 CM OO^O T-i 00 
 
 oor^i^r^No 
 
 ooooo 
 ooooo 
 
 OTfioOvVO 
 CM CM 00^ O 
 0'-"^OiO 
 lo fO O On Ti- 
 lO CM CM CO tN. 
 VOiO Tl- coCM 
 
 qoooniooo q 
 
 Q O Ot^ CO O 
 
 OvTj-csr^t^ 00 
 
 CM '-HtN.ooO O 
 
 CMOOtI-CM On 00 
 
 CM '-H ,-H ^ O O 
 
 O QOQO O 
 
 ooooo o 
 
 cSd>'^<:5<zi c5cid>ci<5 d 
 
 —•CM '-'CM ON 
 
 t^ r>. •'I- 1^ lo 
 
 CO CO "^ to t^ 
 
 On 001^ NO to 
 
 ooooo 
 
 lovotOTj-m 
 
 COt-iCM "-H t^ 
 00 '^ CO CM t^ 
 
 ON 00 r-HOOOO 
 OnOvJ NO On CO 
 ■«:1- Tf CO CM (M 
 
 ooooo 
 
 00 CM 00 On 00 
 CM CM CM CO NO 
 
 t^ 00 00 to t^ 
 
 CM On ON CM t^ 
 00 CM t^ CO 00 
 
 ;ij;i^22o 
 
 ooooo 
 
 CO 00 NO NO t^ 
 TfO-^o^NO 
 
 CO "-I owe-* 
 
 ti-5 »0 NO O NO 
 
 rfO NO CO 0\ 
 On On 00 00 t^ 
 
 OOOOO 
 
 ooooo 
 
 ^-HCOCMvOtO 
 t^ CM NO CM On 
 CO CO 00 00 o 
 CO^OOOONO 
 
 NocM o^-i T^ 
 
 tN» NO tOTf CO 
 
 ~ " " o 
 
 o 
 <ziocD<od> 
 
 o oncm '— ' vo rx 
 
 '-'OONOOOTf CM 
 
 C?N rf NO t^to On 
 
 NOOOOOtOOO to 
 
 00 CO On NO CO •-I 
 
 CMCM '-"-H ^ ^ 
 
 88888 8 
 
 ddddd d 
 
 vOfOCMCMVO 
 
 CM On NO'-" ON 
 On 00 NO ^'—' 
 
 '-' ONTt tDcq 
 
 O OnO '— I CO 
 ^ On On 00 t^ 
 
 (M— .^r-^-H 
 
 ooooo 
 
 On On CM '^ to 
 
 CM t^ NO CO 00 
 C3n CO »-' On CO 
 coo '—I to Tj- 
 tOOO '-H "^00 
 NO to to "^ CO 
 
 OO^t^T-ito 
 
 CO rj- NO '-H 00 
 CMCM '-'OOCA 
 NO'-H OnCTnCM 
 CMt^'-iNOCM 
 COCMCM '-H »-< 
 
 ooooo 
 
 ooooo 
 
 ,—1 lO to l^ i-H 
 
 to CM Ot^ CO 
 
 OONO NOt^ r-l 
 
 r^ CO On to CM 
 
 O O On On ON 
 
 ooooo 
 
 or^ VD "-H CO 
 to O On 00 vo 
 to ON CM to VO 
 VO"^ corf CO 
 
 00 CO '-H r-H CO 
 
 oo^^ NOtoT^ 
 
 88888 
 
 NOioovor^ r^ 
 
 ON tN. to tOt^ vo 
 
 tN» ,— 1 vototo vo 
 
 NO '-1 Tl-IOCM Tf 
 
 vo '-H VOCM On vo 
 COCOCMCM i-H ^ 
 
 88888 8 
 
 ooooo ooooo o 
 
 CM CO CO CO to 
 ^ to NO to t>» 
 
 Tj".*- CM CM 00 
 00 to On On -^ 
 
 OOOOOOON'-" 
 — 'OONGOOO 
 CM CM •-' ^ '-' 
 
 ooooo 
 
 to CM CO 
 
 ■^ COLT) 
 
 NO'— ON 
 
 to T- ' o 
 
 CO NO ON 
 t^ NO to 
 
 ooo 
 
 Tj-NO 
 
 NO to 
 
 r^CM 
 
 CM NO 
 
 to Tf 
 
 So 
 d>cS 
 
 T-HQtO'-i O 
 
 to or^i^ O 
 
 '-' Cvj '-' 00 '-H 
 coi^ Tf CO vo 
 O'^ONTfC^ 
 Tf coCM CM '-' 
 
 ooooo 
 
 CO CO 00 
 On On to 
 
 NOTf CO 
 
 or^ NO 
 
 to O vo 
 
 ooo 
 
 00 CO 
 tot^ 
 
 t^ 0\ 
 
 C^lOO 
 O 0\ 
 '-' o 
 
 o o 
 
 CM CO CM 
 
 ONtO O 
 
 OOnO 
 Tj-t^CM 
 
 to ONt^ 
 
 ONt^ NO 
 
 ooo 
 ooo 
 
 OOO 
 
 (M -H 
 
 ^CM 
 
 ON'rf 
 NO 00 
 
 to Tf 
 
 88 
 
 QCMOtO'-H CJO 
 
 NOTf CM CM Tf 1— 1 
 
 tOCOTf ^ ,— I Tf 
 
 CO Tf Tf CM NO to 
 '-HtoOvOCM 
 Tf CO CO CM CM 
 
 8 oooo o 
 
 oooo o 
 
 d>d>d>cid> d 
 
 ON 
 
 O'-'CMCOTt iONOt^00C?N O^CMCOT^ to vO t^ 00 C?\ O to O to O to O to O to 
 COCOCOCOCO COCOCOCOCO T^TfTfTfTf TfTfTfT^fTf lOtONONOt^. t^ 00 00 On ON 
 
356 
 
 §383. 
 
 TABLES 
 
 Table VI 
 Reciprocals and Square Roots 
 
 
 
 Square 
 
 
 
 Square 
 
 Ratio 
 
 Reciprocal 
 
 Root 
 
 Ratio 
 
 Reciprocal 
 
 Root 
 
 (1 + 
 
 (Discount 
 
 (Quarterly 
 
 (1+0 
 
 (Discount 
 
 (Quarterly 
 
 
 Multiplier) 
 
 Ratio) 
 
 
 Multiplier) 
 
 Ratio) 
 
 1.005 
 
 .99502488 
 
 1.00249688 
 
 1.02 
 
 .98039216 
 
 1.00995049 
 
 L00525 
 
 .99477742 
 
 1.00262156 
 
 1.02025 
 
 .98015192 
 
 1.01007425 
 
 1.0055 
 
 .99453008 
 
 1.00274623 
 
 1.0205 
 
 .97991181 
 
 1.01019800 
 
 1.00575 
 
 .99428287 
 
 1.00287088 
 
 1.02075 
 
 .97967181 
 
 1.01032173 
 
 1.006 
 
 .99403579 
 
 1.00299551 
 
 1.021 
 
 .97943193 
 
 1.01044545 
 
 1.00625 
 
 .99378882 
 
 1.00312013 
 
 1.02125 
 
 .97919217 
 
 1.01056915 
 
 1.0065 
 
 .99354198 
 
 1.00324474 
 
 1.0215 
 
 .97895252 
 
 1.01069283 
 
 1.00675 
 
 .99329526 
 
 1.00336932 
 
 1.02175 
 
 .97871299 
 
 1.01081650 
 
 1.007 
 
 .99304866 
 
 1.00349390 
 
 1.022 
 
 .97847358 
 
 1.01094016 
 
 1.00725 
 
 .99280218 
 
 1.00361845 
 
 1.02225 
 
 .97823429 
 
 1.01106380 
 
 1.0075 
 
 .99255583 
 
 1.00374299 
 
 1.0225 
 
 .97799511 
 
 1.01118742 
 
 1.00775 
 
 .99230960 
 
 1.00386752 
 
 1.02275 
 
 .97775605 
 
 1.01131103 
 
 1.008 
 
 .99206349 
 
 1.00399203 
 
 1.023 
 
 .97751711 
 
 1.01143462 
 
 1.00825 
 
 .99181751 
 
 1.00411653 
 
 1.02325 
 
 .97727828 
 
 1.01155820 
 
 1.0085 
 
 .99157164 
 
 1.00424101 
 
 1.0235 
 
 .97703957 
 
 1.01168177 
 
 1.00875 
 
 .99132590 
 
 1.00436547 
 
 1.02375 
 
 .97680098 
 
 1.01180532 
 
 1.009 
 
 .99108028 
 
 1.00448992 
 
 1.024 
 
 .97656250 
 
 1.01192885 
 
 1.00925 
 
 .99083478 
 
 1.00461435 
 
 1.02425 
 
 .97632414 
 
 1.01205237 
 
 1.0095 
 
 .99058940 
 
 1.00473877 
 
 1.0245 
 
 .97608590 
 
 1.01217588 
 
 1.00975 
 
 .99034414 
 
 1.00486317 
 
 1.02475 
 
 .97584777 
 
 1.01229936 
 
 1.01 
 
 .99009901 
 
 1.00498756 
 
 1.025 
 
 .97560976 
 
 1.01242284 
 
 1.01025 
 
 .98985400 
 
 1.00511193 
 
 1.02525 
 
 .97537186 
 
 1.01254630 
 
 1.0105 
 
 .98960910 
 
 1.00523629 
 
 1.0255 
 
 .97513408 
 
 1.01266974 
 
 1.01075 
 
 .98936433 
 
 1.00536063 
 
 1.02575 
 
 .97489642 
 
 1.01279317 
 
 1.011 
 
 .98911968 
 
 1.00548496 
 
 1.026 
 
 .97465887 
 
 1.01291657 
 
 1.01125 
 
 .98887515 
 
 1.00560927 
 
 1.02625 
 
 .97442144 
 
 1.01303998 
 
 1.0115 
 
 .98863075 
 
 1.00573356 
 
 1.0265 
 
 .97418412 
 
 1.01316336 
 
 1.01175 
 
 .98838646 
 
 1.00585784 
 
 1.02675 
 
 .97394692 
 
 1.01328673 
 
 1.012 
 
 .98814229 
 
 1.00598211 
 
 1.027 
 
 .97370983 
 
 1.01341008 
 
 1.01225 
 
 .98789825 
 
 1.00610636 
 
 1.02725 
 
 .97347286 
 
 1.01353342 
 
 1.0125 
 
 .98765432 
 
 1.00623059 
 
 1.0275 
 
 .97323601 
 
 1.01365675 
 
 1.01275 
 
 .98741052 
 
 1.00635481 
 
 1.02775 
 
 .97299927 
 
 1.01378006 
 
 1.013 
 
 .98716683 
 
 1.00647901 
 
 1.028 
 
 .97276265 
 
 1.01390335 
 
 1.01325 
 
 .98692327 
 
 1.00660320 
 
 1.02825 
 
 .97252614 
 
 1.01402663 
 
 1.0135 
 
 .98667982 
 
 1.00672737 
 
 1.0285 
 
 .97228974 
 
 1.01414989 
 
COMPOUND INTEREST; OTHER COMPUTATIONS 
 
 357 
 
 Reciprocals and Square Roots — (Conclvuled) 
 
 
 
 Square 
 
 
 
 Square 
 
 Ratio 
 
 Reciprocal 
 
 Root 
 
 Ratio 
 
 Reciprocal 
 
 Root 
 
 (1+0 
 
 (Discount 
 
 (Quarterly 
 
 (1+0 
 
 (Discount 
 
 (Quarterly 
 
 
 Multiplier) 
 
 Ratio) 
 
 
 Multiplier) 
 
 Ratio) 
 
 1.01375 
 
 .98643650 
 
 1.00685153 
 
 1.02875 
 
 .97205346 
 
 1.01427314 
 
 1.014 
 
 .98619329 
 
 1.00697567 
 
 1.029 
 
 .97181730 
 
 1.01439637 
 
 1.01425 
 
 .98595021 
 
 1.00709980 
 
 1.02925 
 
 .97158125 
 
 1.01451959 
 
 1.0145 
 
 .98570725 
 
 1.00722391 
 
 1.0295 
 
 .97134531 
 
 1.01464279 
 
 1.01475 
 
 .98546440 
 
 1.00734800 
 
 1.02975 
 
 .97110949 
 
 1.01476598 
 
 1.015 
 
 .98522167 
 
 1.00747208 
 
 1.03 
 
 .97087379 
 
 1.01488916 
 
 1.01525 
 
 .98497907 
 
 1.00759615 
 
 1.0325 
 
 .96852300 
 
 1.01612007 
 
 1.0155 
 
 .98473658 
 
 1.00772020 
 
 1.035 
 
 .96618357 
 
 1.01734950 
 
 1.01575 
 
 .98449422 
 
 1.00784423 
 
 1.0375 
 
 .96385542 
 
 1.01857744 
 
 1.016 
 
 .98425197 
 
 1.00796825 
 
 1.04 
 
 .96153846 
 
 1.01980390 
 
 1.01625 
 
 .98400984 
 
 1.00809226 
 
 1.0425 
 
 .95923261 
 
 1.02102889 
 
 1.0165 
 
 .98376783 
 
 1.00821625 
 
 1.045 
 
 .95693780 
 
 1.02225242 
 
 1.01675 
 
 .98352594 
 
 1.00834022 
 
 1.0475 
 
 .95465394 
 
 1.02347447 
 
 1.017 
 
 .98328417 
 
 1.00846418 
 
 1.05 
 
 .95238095 
 
 1.02469508 
 
 1.01725 
 
 .98304252 
 
 1.00858812 
 
 1.0525 
 
 .95011876 
 
 1.02591423 
 
 1.0175 
 
 .98280098 
 
 1.00871205 
 
 1.055 
 
 .94786730 
 
 1.02713193 
 
 1.01775 
 
 .98255957 
 
 1.00883596 
 
 1.0575 
 
 .94562648 
 
 1.02834819 
 
 1.018 
 
 .98231827 
 
 1.00895986 
 
 1.06 
 
 .94339623 
 
 1.02956301 
 
 1.01825 
 
 .98207709 
 
 1.00908374 
 
 1.0625 
 
 .94117647 
 
 1.03077641 
 
 1.0185 
 
 .98183603 
 
 1.00920761 
 
 1.065 
 
 .93896714 
 
 1.03198837 
 
 1.01875 
 
 .98159509 
 
 1.00933146 
 
 1.0675 
 
 .93676815 
 
 1.03319892 
 
 1.019 
 
 .98135427 
 
 1.00945530 
 
 1.07 
 
 .93457944 
 
 1.03440804 
 
 1.01925 
 
 .98111356 
 
 1.00957912 
 
 1.08 
 
 .92592593 
 
 1.03923048 
 
 1.0195 
 
 .98087298 
 
 1.00970293 
 
 1.09 
 
 .91743119 
 
 1.04403065 
 
 1.01975 
 
 .98063251 
 
 1.00982672 
 
 1.10 
 
 .90909091 
 
 1.04880885 
 
INDEX 
 
 (References are to sections unless otherwise noted.) 
 
 Account, 
 
 Amortization, §§ 198, 205, 208-212, 214. 
 
 Insurance, § 179. 
 
 Principal, §§ 164, 169, 179, 186-188, 202. 
 
 Taxes, § 179. 
 Accounts, 
 
 Amortization, installation, §§ 334-336. 
 
 Bond and mortgage loans, §§ 162-184. 
 
 Bonds, §§ 197-214. 
 
 Collateral, §§ 185-188. 
 
 Discounts, §§215-221. 
 
 Interest, §§ 161, 164, 165, 171, 172, 174-176, 179-181, 183, 186-196, 
 203, 204, 220. 
 Accumulation, 
 
 Dual rate for, §§ 326, 327. 
 
 Schedule of, § 122. 
 Amortization, §§249, 348. 
 
 Account, §§ 198, 205, 208-212, 214. 
 
 Accounts, installation, §§ 334-336. 
 
 Definition of, § 70. 
 
 Development of series of, §§ 72, 249. 
 
 Interest-difference, §271. 
 
 Of premiums, §§ 328-330. 
 
 Relation to present worth, § 71. 
 
 Relation to sinking fund, § 90. 
 
 Schedules of, §§ 121, 122, 126, 130, 134, 139-141, 281. 
 Amount, §§25, 26, 28, 30, 31. 
 
 Of ordinary annuity, §§ 53-61. 
 
 Of prepaid annuity, § 75. 
 
 Proof of by reciprocal, § 227. 
 Amounts of $1, table of, § 378; comment, § 367. 
 Amounts of annuity of $1, table of, § 380; comment, § 370. 
 
 359 
 
360 
 
 INDEX 
 
 Annualization, §§ 301-310. 
 Annuities, Chs. IV-VII. 
 
 Amount of ordinary, §§ 53-61. 
 
 Finding, §§60, 61. 
 Analysis of payments, § 68. 
 As sinking funds, §§ 87-90. 
 Deferred, §§ 11, 78. 
 Deferred payment, § 86. 
 Definition of, § 54. 
 Due, §§ 75, 76. 
 
 Immediate or ordinary, §§ 74-76. 
 Instalments of, § 69. 
 
 Present worth of ordinary, §§ 62-73, 304. 
 Problems, §§ 232, 233. 
 Rents of, §§ 83-86, 373. 
 
 Problems, §§ 234, 235. 
 Tables, 
 
 How formed, §§ 56-58, 257. 
 
 Of amount, §380; comment, §370. 
 
 Of present worth, §381; comment, §371. 
 
 To four periods, § 63. 
 Varying, §82. 
 
 B 
 
 Base in logarithms, § 391. 
 
 Bond problems, Chs. XXI-XXVII. 
 
 Broken initial and short terminal bonds, §§255, 256. 
 
 Cash and income rates, § 243. 
 
 Compound discount, § 261. 
 
 Compound interest, § 262. 
 
 Discounting, §§ 270, 271. 
 
 Income rate, accurate, §§ 263-269. 
 
 Initial book values, § 247. 
 
 Nominal and effective rates, §§ 236-240. 
 
 Premium and discount, § 243. 
 
 Present worth, finding, §§258-261. 
 
 Redemption of bonds, §§ 287-294. 
 
 Semi-annual basis, § 300. 
 
 Serial bonds, §§ 274-286. 
 
 Successive amortizations, § 249. 
 
 Successive method, §§ 244, 318. 
 
 Tabular methods, § 283. 
 
 Varying rates, §§ 298, 299. 
 
 Varying time basis, § 312. 
 
INDEX 
 
 Bonds, Chs. IX-XI, XVII, XXI, XXII, XXV-XXVIII. 
 
 Accounts, §§ 197-214. 
 
 As trust fund investments, §§ 148-154. 
 
 Cullen decision, §§ 152-154. 
 Broken initial, problems, §§255, 256. 
 Cost and par of, § 104. 
 Cost of, relation to net income, § 99. 
 • Discounts on, §§ 207, 214, 258. 
 Earning capacity of, § 103. 
 Elements of, § 110. 
 How designated, § 98. 
 Interest. (See "Interest.") 
 Investments in, § 119. 
 Investment value of, §§ 106, 108. 
 Irredeemable, §§ 146, 213. 
 Last half-year of, § 144. 
 Ledger for, §§ 200, 202. 
 Loans on, §§ 162-181. 
 Premiums. (See "Premiums.") 
 Present worth of, §§ 101, 103, 106. 
 Problems. (See "Bond Problems.") 
 Provisions of, § 96. 
 Purchase of, §§ 102, 128, 129. 
 
 Adjusting errors, § 129. 
 Rates, 
 
 Annual and successive, §§ 295-318. 
 
 Income, §§ 134, 136-140, 263-269, 287. 
 
 Interest, §§ 97, 100, 109. 
 
 Varying, § 150. 
 Redemption of, §§ 146, 147. 
 
 Problems, §§ 287-294. 
 Repayment and reinvestment, §§319-336. 
 Replacement, §§ 148, 322, 323. 
 Residues, eliminating, §§ 138-140, 280. 
 Schedules, 
 
 Accumulation, § 122. 
 
 Amortization, §§ 121, 122, 126, 130, 134, 139-141, 281. 
 
 Checks on accuracy, § 124. 
 Serial, § 145. 
 
 Problems, §§ 274-286. 
 Short terminal, §§ 141, 142. 
 
 Problems, §§ 255, 256. 
 Tables, § 155; comment, § 156. 
 
 Of differences, § 276. 
 
 361 
 
362 INDEX 
 
 Bonds (Continued) 
 
 Tables (Continued) 
 
 Use in compound interest problems, §§ 257-262. 
 
 Use in determining accurate income rate, §§ 263-269. 
 Valuation of, Chs. X, XI. 
 
 First method, §§111-114. 
 
 Interpolation method, §§ 131, 132. 
 
 Multiplication method, §§ 133, 134. 
 
 Periodic, §§ 130-133. 
 
 Problems, §§ 243-318. 
 
 Rule for, §§305, 316. 
 
 Schedules, §§114, 122, 126, 127, 130. 
 
 Second method, §§ 115-120. 
 Values of, § 127. 
 
 Book, §§ 123, 125. 
 
 Found by discounting, §§ 143, 144. 
 
 Initial book, § 247. 
 
 Intermediate, § 105. 
 
 Market, § 107. 
 
 Various, §§ 104-108. 
 
 C 
 
 Capital, 
 
 Account, §§ 1, 3. 
 
 Cash, § 2. 
 
 Definition of, § 1. 
 
 Potential, § 2. 
 
 Sources of, § 3. 
 
 Use of, § 2. 
 
 Working, § 2. 
 Card records for mortgages, § 178. 
 Cash, § 2. 
 
 Characteristic, §41. 
 Collateral, loans on, §§ 185-188. 
 CompoundMiscount, §§ 33-35, 261. 
 Compound interest, §§ 13, 17-19. 
 
 Amount of, § 28. 
 
 Problems, §§ 225, 226. 
 
 Interpolated values, § 376. 
 Use of tables, §§ 262, 368. 
 
 Rules and formulas, §§35, 157-159. 
 
 Tables, §§ 359, 360, 378. 
 
 Use of logarithms in computing, § 49. 
 Contracted division, § 248. 
 Contracted multiplication, § 228, 270. 
 
INDEX 363 
 
 Conversions of rates, § 92. 
 Coupons, §§ 113, 296. 
 CuUen decision, §§ 152-154. 
 
 Day as time unit, §§ 20, 24. 
 
 Day basis, 360 and 365 methods, §§ 23, 24. 
 
 Days, odd, how reckoned, § 23. 
 
 Deferred annuities, §§ 11, 78. 
 
 Differences, table of, § 276. 
 
 Differencing, 
 
 Discovery of errors by, §§250-254. 
 
 Present worth by, § 259. 
 Discount, Chs. XVIII, XIX. 
 
 Compound, §§ 33-35, 261. 
 
 Formulas, § 35. 
 
 On bonds, §§ 207, 214, 258. 
 
 Single, §§33,216-218. 
 Discounting, 
 
 Contracted methods for, §§ 270-273. 
 
 To find bond values, §§ 143, 144. 
 Dividends, § 7. 
 Division, 
 
 By logarithms, §45. 
 
 Contracted, § 248. 
 Dual rates, §§ 326-333. 
 
 E 
 
 Effective rates, §§ 91-95. 
 
 Problems, §§236-240. 
 Errors, discovery of, by differencing, §§ 250-254. 
 Evaluation, 
 
 Method by logarithms, § 73. 
 
 Of a series of payments, § 53. 
 Exponents, §§ 27, 38, 39. 
 
 Fractional, § 48. 
 
 F 
 Factors, logarithmic, table of, §358; comment, §§342-357. 
 Forms, 
 
 Bond accounts, §§ 197-214. 
 
 Discount accounts, §§ 215-221. 
 
 Interest accounts, §§ 176, 179, 188, 192, 193, 195, 220. 
 
 Loans on collateral accounts, §§ 185-188. 
 
 Mortgage accounts, §§ 176-183. 
 
3^4 
 
 INDEX 
 
 Formulas for interest calculations, §§ 157-159. 
 
 Fractional exponents, § 48. 
 
 Frequency, definition of, in interest computations, § 10. 
 
 G 
 
 General ledger, §§ 160, 180, 182, 195, 200. 
 Gray's tables of logarithms, § 341. 
 
 H 
 Half-year, legal definition of, § 22. 
 
 Immediate annuities, §§ 74-76. 
 Income rate on bonds, §§ 134-140, 263-269, 287, 297. 
 Dual, § 326. 
 Relation to cost, §93. 
 Rule for determining, § 293. 
 Use of tables, §§ 257-259. 
 Increase, ratio of, § 17. 
 Initial book values of bonds, § 247. 
 Insurance account, § 179. 
 Interest, Chs. II, XVI, XVIII, XIX, XXI. 
 
 Accounts, §§ 161, 164, 165, 171, 172, 174-176, 179-181, 183, 186-196, 
 
 203, 204, 220. 
 Calculations, formulas for, §§35, 157-159. 
 Compound. (See "Compound Interest.") 
 Computations, §§ 15, 19. 
 Constant compounding, § 238. 
 Contract, essentials of, § 10. 
 Definition of, §§ 6, 9. 
 Equivalent rates of (annual, semi-annual and quarterly), 
 
 §§241, 242. 
 Laws of, § 8. 
 
 One per cent method, § 223. 
 Periods, §§ 20-24. 
 Punctual, §§ 14, 17. 
 Rates, 
 
 Coupon (cash), §§ 100, 109. 
 Diminishing, §§ 323, 324. 
 Dual, §§ 326-333. 
 Effective, §§ 91-95. 
 Nominal, §§91, 97. 
 Usual, on bonds, §97. 
 Varying, § 325. 
 
INDEX 
 
 Interest (Continued) 
 
 Ratios, table of, §359. 
 
 Receipts and notices, § 181. 
 
 Register, §§ 180, 183, 192, 193. 
 
 Simple (single), §§ 13, 16, 19. 
 Problems, §§222-224. 
 Interest-difference, present worths of, § 271. 
 Intermediate dates, bonds purchased at, § 128. 
 Interpolated method of valuation of bonds, §§ 131, 132. 
 Interpolation in interest problems, §§ 339, 376. 
 Inter-rates, §§ 275, 375, 376. 
 Investment, §§4, 119, 150. 
 
 Absolute, §4. 
 Investment value of bonds, §§ 106, 108. 
 Investments, trust fund, bonds as, §§ 148-154. 
 Irredeemable bonds, §§ 146, 213. 
 
 Ledger, 
 
 Bond, §§ 200, 202. 
 
 Books auxiliary to, § 173. 
 
 Forms, §§ 182, 195, 200. 
 
 General, §§ 160, 180, 182, 195, 200. 
 
 Loose-leaf, § 178. 
 
 Modern, § 166. 
 
 Mortgage, §§ 167, 182. 
 
 Subordinate, § 160. 
 Life tenants, payments to, §§ 148-154. 
 Little's table of multiples, §361; comment, §356. 
 Loans, 
 
 On collateral, §§ 185-188. 
 
 On bond and mortgage, §§ 162-184. 
 
 Periodic payment, §319. 
 
 Uneven, § 282. 
 Logarithms, Chs. Ill, XXIX, XXX. 
 
 Accuracy of results, §§ 50, 51. 
 
 Application of. 
 
 To amount of annuity, §61. 
 
 To present worth of annuity, § 73, 
 
 Bases of, §357. 
 
 Characteristic, §41. 
 
 Division by, § 45. 
 
 Factoring method, §§ 343-346. 
 
 Finding numbers from, §§337-347. 
 
 365 
 
366 INDEX 
 
 Logarithms (Continued) 
 Forming, §§ 348-357. 
 
 Multiplying up, §§ 353-356. 
 In connection with effective rates, § 95. 
 In connection with valuation of bonds, § 120. 
 Mantissa, §§41, 42. 
 • Multiple method, §347. 
 Multiplication by, § 44. 
 Powers, finding, § 46. 
 Problems, §§229-231. 
 Roots, finding, §47. 
 Rules for use of, §§ 40, 44-47. 
 Tables, 
 
 Gray and Steinhauser, § 341. 
 
 Standard, §339. 
 
 To fifteen places, §359; comment, §51. 
 
 To four places, § 43. 
 
 To twelve places, §358; comment, §§342-357. 
 
 United States Coast Survey, § 340. 
 Two parts of, § 41. 
 Use of, §§ 36, 37. 
 
 In compound interest computations, §49. 
 
 In present worth computations, § 52. 
 Loose-leaf records for mortgages, § 178. 
 
 Mantissa, §§41, 42. 
 
 Market value of bonds, § 107. 
 
 Month as time unit, § 21. 
 
 Mortgages, §§ 163-184. 
 
 Multiples, Little's table of, §361; comment, §356. 
 
 Multiplication, 
 
 By logarithms, § 44. 
 
 Contracted, §228. 
 
 Tabular, §248. 
 
 N 
 
 Net income, problems, § 293. 
 Nominal rates, § 91. 
 
 Problems, §§ 236-240. 
 Notes, §§217-220. 
 Notices of interest, § 181. 
 
INDEX 367 
 
 O 
 
 Optional redemption, bonds with, § 147. 
 
 Problems, §§ 287-294. 
 Ordinary annuities, §§ 74-76. 
 
 Payments, periodic, §§ 319-336. 
 Periods, 
 
 Annuity and interest compared, § 81. 
 
 Interest, §§ 20-26, 364, 374. 
 Perpetuities, §§ 79, 80. 
 Powers, §§ 27, 38. 
 
 Finding, by logarithms, § 46. 
 Premiums on bonds. 
 
 Accounts, §§ 207, 209, 210, 214. 
 
 Amortization of, § 328. 
 
 Analysis of, § 317. 
 
 Deferred, §315. 
 
 Immediate, §314. 
 
 Valuation of, §§ 329, 330. 
 Prepaid annuities, §§ 75, l(i. 
 Present worth, §§29-31, 261. 
 
 By differences, § 259. 
 
 By division, § 260. 
 
 Formulas for, § 67. 
 
 Logarithmic computation of, § 52. 
 
 Of annuities due, §§ 75, Id. 
 
 Of bonds, §§101, 103, 106. 
 
 Of coupons, §§ 113, 296. 
 
 Of deferred annuities, §§ 11 , 78. 
 
 Of ordinary annuity, §§ 62-73, 304. 
 
 Of perpetuities, §§79, 80. 
 
 Of principal, § 112. 
 
 Proof of by reciprocal, § 227. 
 
 Relation to amortization, § 71. 
 
 Short method for, §§ 64-67. 
 Present worths, 
 
 Of $1, tables, §§63, 379; comment, §369. 
 
 Of annuity of $1, table, § 381 ; comment, § 371. 
 
 Of interest-diflerence, §271. 
 Principal, § 12. 
 
 Account, §§ 164, 169, 179, 186-188, 202. 
 
 Change in, § 290. 
 
 Definition of, § 10. 
 
368 INDEX 
 
 Problems, 
 
 Annuities, §§ 232, 233. 
 
 Bonds at annual and successive rates, §§295-318. 
 
 Bonds with optional redemption, §§287-294. 
 
 Interest, 
 
 Compound, §§ 225, 226. 
 
 Simple, §§ 222-224. 
 Logarithms, §§229-231. 
 Nominal and effective rates, §§ 236-240. 
 Rent of annuity, §§ 234, 235. 
 Serial bonds, §§ 274-286. 
 Sinking funds, §§ 234, 235. 
 
 Valuation of bonds, §§243-318. (See also "Bond Problems.") 
 Punctual interest, §§ 14^ 17. 
 
 Q 
 
 Quarter-year, legal definition of, § 22. 
 
 Rates, 
 
 Annual and other, §§295-318. 
 
 Conversions of, § 92. 
 
 Coupon (cash), §§ 100, 109. 
 
 Definition of, § 10. 
 
 Dual, §§ 326-333. 
 
 Effective, §§91-95, 100. 
 Problems, §§ 236-240. 
 
 Equivalent (annual, semi-annual and quarterly), §§ 241, 242. 
 
 Income, on bonds, §§ 109, 134, 136, 137, 138-140, 263-269, 287, 291. 
 
 In interest tables, § 364. 
 
 Inter-rates, §§ 275, 375, Z76. 
 
 Logarithmic method, § 95. 
 
 Nominal, §§91, 97. 
 
 Problems, §§ 236-240. 
 
 Trial, §§ 264-269. 
 Ratios of increase, § 17. 
 
 Logarithms of, fifteen-place table, §359; comment, §51. 
 Real estate mortgages, §§ 163-184. 
 Receipts and notices, interest, § 181. 
 Reciprocals, 
 
 Amount and present worth as, § 227. 
 
 Meaning of, § 52. 
 
 Table of, § 383; comment, § Z77. 
 
INDEX 36^ 
 
 Redemption of bonds, §§ 146, 147. 
 
 Problems, §§ 287-294. 
 Register, 
 
 Collateral, §§ 186,-188. 
 
 Interest, §§ 180, 183, 192, 193. 
 Rent, 
 
 Definition of, §6. 
 
 Of annuity, §§ 83-86, Z73. 
 
 Of deferred payments, §86. 
 Problems, §§ 234, 235. 
 Repayment and reinvestment, §§319-336. 
 Replacement, §§ 148, 322, 323. 
 Residues on bonds, eliminating, §§ 138-140, 280. 
 Reussner's tables, § 273. 
 Revenue, forms of, § 5. 
 Roots, § 38. 
 
 Finding, by logarithms, § 47. 
 Rules and formulas, §§ 35, 157-159. 
 
 Security, collateral, §§ 185-188. 
 Serial bonds, § 145. 
 
 Problems, §§ 274-286. 
 Series, §§ 30-32. 
 
 Amortization, §§ 72, 249. 
 
 Of annuity amounts, §56. 
 Short terminal bonds, §§141, 142. 
 
 Problems, §§255, 256. 
 Simple (single) interest, §§ 13, 16, 19. 
 
 Problems, §§ 222-224. 
 Single discount, %%ZZ, 216-218. 
 Sinking funds, §§ 87-90. 
 
 Problems, §§ 234, 235. 
 
 Relation to amortization, § 90. 
 
 Table, §382; comment, §372. 
 Square roots, table of, §383; comment, §377. 
 Steinhauser's tables of logarithms, § 341. 
 Subordinate ledgers, § 160. 
 Sub-reciprocals, table of, § 360. 
 Successive method, § 277. 
 
 Problems, §244. 
 Successive rates, bonds at, §§313-318. 
 Symbols, explanation of, page xviii. 
 
370 INDEX 
 
 T 
 
 Tables, 
 
 Amounts of $1, §378; comment, §367. 
 
 Amounts of annuity of $1, §380; comment, §370. 
 
 Bonds, § 155; comment, § 156. 
 
 Differences, § 276. 
 
 Four-place, § 43. 
 
 Interest ratios to fifteen places, §359; comment, §51. 
 
 Multiples, §361; comment, §356. 
 
 Present worths of $1, §§63, 379; comment, §369. 
 
 Present worths of annuity of $1, §381; comment, §371. 
 
 Reciprocals, §383; comment, §377. 
 
 Reussner's, comment, § 273. 
 
 Sinking funds, §382; comment, §372. 
 
 Square roots, §383; comment, ^377. 
 
 Sub-reciprocals, § 360. 
 
 Twelve-place logarithmic factors, §358; comment, §§342-357. 
 Tabular multiplication, § 248. 
 Time units, §§ 10, 23. 
 
 Day, §§ 20, 24. 
 
 Half and quarter years, § 22. 
 
 Month, §21. 
 Trust funds, §§ 148-154. 
 
 Cullen decision, §§ 152-154. 
 Twelve-place logarithms, tables, §358; comment, §§342-357. 
 
 U 
 
 United States Coast Survey tables, § 340. 
 
 Valuation of bonds, Chs. X, XI. 
 
 First method (two operations), §§111-114. 
 
 Interpolation method, §§ 131, 132. 
 
 Multiplication method, §§ 133, 134. 
 
 Periodic, §§ 130-133. 
 
 Problems, §§243-318. 
 
 Rule for, §§305, 316. ■ 
 
 Schedules, §§ 114, 122, 126, 127, 130. 
 
 Second method (one operation), §§115-120. 
 Valuation of premiums, §§ 329. 330. 
 
INDEX 2^j 
 
 Values, 
 
 Discounted, §§ 215-221. 
 Of bonds, § 127. 
 
 Book, §§ 123, 125. 
 
 Found by discounting, §§ 143, 144. 
 
 Initial book, § 247. 
 
 Intermediate, §§ 105, 376. 
 
 Market, § 107. 
 
 Various, §§ 104-108. 
 Varying annuities, § 82. / 
 
 y ^ 
 
 Year, legal, §§23, 24. 
 
14 DAY USE 
 
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