Level 4 credit control - compound annual cost - Help please!

NM_X17

I am struggling with the calculation for compound annual cost. The example i have in my workbook is as follows -

(1+ 3/100-3) ^ (365/60-30) - 1 ) x 100 = 44.86%

The part im really struggling with is the "to the power of"

I havent had to use this since school which is a very long time ago so not sure exactly how I use this on the calculator.

Any help and advice would be great.

Mike Webster

Work out the two part of the equation first:

(3/100-3)+1 = 1.03092784
and
(365/60-30) = 12.1666667

The enter your answer from the first, press the 'to the power' button then enter the answer to the second part.

1.03092784 to the power of 12.1666667 = 1.4485848

Subtract 1 = 1.4485848 - 1 = 0.4485848

then multiply by 100 = 44.85848% (rounded up to 44.86%)

Does that help?