You invest $30k at 20% for 20 years. What is the future value using monthly compounding? If you then borrowed another $30k to invest in the same 20% investment and agreed to pay the lender 10%, interest only, on a monthly basis for the same 20 years and invest the increased cash flow from the borrowed money back into the same investment, how much would you have at the end of 20 years? What would be the return on your initial $30k?

(The answer will be posted with the new calculator problem in 2 weeks. Or if you can’t wait that long, you can go to http://www.facebook.com/pages/Gary-Johnston-Seminars/111368472221424 for the answer.)

The answer to the 2010-08-16 calculator problem is I=17.27% (N=60, PV= -16,000, PMT= 400, FV=0)