I’ve seen plenty of places talk about which calculators we should all use for science, engineering, finance, and real estate. What bothers me is that there are plenty of great calculators, but nobody talks about what you should use for economics. On top of this, you’ll find that there are people who get ridiculous and say things like, “You don’t need much more than a simple $3 calculator from Target.” This leaves most of us in the dark when shopping for calculators.
As economics majors, we sometimes get screwed over when we think that we can just buy a fancy $150 graphing calculator and find out that our professors don’t allow them. Luckily, I’ve done some of the hard work and research by looking into things for us.
So Many Kinds of Calculators
I’ll just tell you right now that you don’t need a graphing calculator for economics classes. Maybe you do for trigonometry and calculus. But you’ll never be able to use them in any of your economics courses. That’s because your professors want to know how your economics skills are, not the calculator’s skills. Scientific calculators have a lot of functions, but they might not have what you’re looking for.
I would say that a financial calculator is what you would benefit the most from. It has all of the functions you need and they’re fairly simple to learn how to use. Some of them are programmable, but only in the sense of TVM (Time Value of Money) calculations and other functions that are included on the calculator. They’re also used in your job in economics and finance after college, so it’s great to know how to use them anyway.
Why Financial Calculators?
You might have a wonderful calculator that does wonders for statistics or calculus. That’s all well and good, but if they don’t have TVM, amortization, or date functions, then there isn’t going to be a whole lot of use for them later. It’s also nice to have the option to have decimals displayed. You can have the usual two decimal points, or you can have it round up and down. Many of them also perform basic stats calculations.
The Best Calculators for Economics Majors
I’m going to be upfront about this: I prefer HP calculators. It’s not that I don’t like the Texas Instrument (TI) calculators at all. It’s just that the TI financial calculators don’t have an RPN input mode. Both calculators that I’ll talk about in a moment are HP and have an RPN input mode. I’ll talk more about RPN input later. First, let’s get to the calculators.
The 12C is one of the oldest and most successful financial calculators. I say it’s one of the best selling calculators because it was introduced in 1981 and is still one of the best selling financial calculators today. It’s more expensive than other financial calculators (about $70 – $90), but they last a long time. This calculator only uses RPN input, so you’d have to learn how to use it (we’ll talk about that later). The date functions are great, too. The funny thing is that there are many more functions than I know how to use.
This calculator is interesting. I’ve never used it, but I’ve been going through the manual and I definitely want to play with it. It has an equation solver and it can do more than twice as many functions as the HP 12C. On top of this, it can be used with a certain printer and can store equations. It’s also a little pricier than other calculators ($42 – $120). But it gives you so much more than what you’d expect. Just go ahead and look at the link to the manual and you’ll see what I mean.
My Recommended Calculator
Hands down, I recommend the HP 12C financial calculator. But it honestly depends on what you’re wanting to do career-wise. If you’re going into banking, finance, accounting, or real estate, I highly recommend the HP 12C. If you’re wanting to do something that is much more complex and requires an equation solver, then the HP 17bII+ may be your best option.
There are plenty of reasons to like both calculators. However, the reason why I like the HP 12C is partially because it’s simpler than the HP 17bII+ and partially because it’s got just about everything you really need for math. The HP 17bII+ has menus, which I’m not very fond of. Something to really like about the HP 12C is that when you get to your job, if you use a calculator fairly often, your supervisors will probably respect the fact that you know how to use an HP 12C. Even if you don’t use it, it’s good to have a sharp mind that understands RPN and the benefits of it.
Why You Should Use RPN
You’ve seen me use the term “RPN” a few times now and you’re probably wondering what the heck it is. RPN is an acronym for Reverse Polish Notation. In short, it’s a quicker way to do math without having to keep clearing your calculator. Here’s an example to show what I mean:
Input the following into your regular calculator: (3 x 4) + (5 x 15) / 435
Your probably did these keystrokes (answer displayed shown in parentheses ): 3 x 4 = (12) CLEAR 5 x 15 = (75) + 12 = (89) / 435
Keystrokes on an RPN calculator (answer displayed shown in parentheses): 3 ENTER 4 x (12) 5 ENTER 15 x (75) + (89) 435 /
While you might be wondering, “How is it any better to keep pressing ENTER than to keep pressing CLEAR?” This was only a short example of what you’ll see in your economics classes. When you’re wanting to calculate more complex equations, you’re probably going to do this: Write down a few executions, input them into the calculator and write down the answers, write another execution, input it to the calculator, write down the answer. By using RPN, you don’t have to use scratch paper for anything other than to keep track of the really long equations.
The biggest reason why you should be using RPN is because you don’t have time to use a lot of scratch paper during your timed exams. You only get an hour or two to complete your exam. As I just mentioned, you don’t have time to fumble with paper and recalculating every execution just to check for accuracy. This may sound cliché, but every second counts when you’re in any timed exam.
What calculators do you use? If you like it, what do you like about it? If not, what’s the problem? Be sure to put your answers in the comments below.
Word of the Wise
Whatever you decide to use, be sure you know how to use all of the functions on it. A cheaper TI calculator with more functions will only help you if you know what you’re doing with it. Likewise, using an HP 12C is only helpful if you understand how to perform linear regressions, amortization, and other important functions that economics majors use. Whatever you get, I urge you to make sure it has an RPN input option and then learn how to use it. As I said earlier, every second counts when your exam is timed.