diff --git a/simulation/modelica/nonlinear_system/Makefile b/simulation/modelica/nonlinear_system/Makefile
index 2eca76ac40d..0cf3552ea19 100644
--- a/simulation/modelica/nonlinear_system/Makefile
+++ b/simulation/modelica/nonlinear_system/Makefile
@@ -44,6 +44,7 @@ problem8_newton.mos \
 problem9.mos \
 problem10.mos \
 problem11.mos \
+problem12.mos \
 
 # test that currently fail. Move up when fixed. 
 # Run make testfailing
diff --git a/simulation/modelica/nonlinear_system/nlsTestPackage.mo b/simulation/modelica/nonlinear_system/nlsTestPackage.mo
index f3415d7a575..7f0654bd197 100644
--- a/simulation/modelica/nonlinear_system/nlsTestPackage.mo
+++ b/simulation/modelica/nonlinear_system/nlsTestPackage.mo
@@ -149,4 +149,23 @@ package nonlinear_system
 
   end problem11;
 
+  model problem12
+    function f1
+      input Real x;
+      input Real y;
+      input Integer n;
+      output Real z;
+    algorithm
+      z := 1;
+      for i in 1:n loop
+        z := z*(x+y);
+      end for;
+    end f1;
+    Real x,y,z;
+  equation
+    x^4 = y - 1;
+    y -3*x^2 + 1 = z*(1-time);
+    z = f1(x,y,5);
+  end problem12;
+
 end nonlinear_system;
diff --git a/simulation/modelica/nonlinear_system/problem12.mos b/simulation/modelica/nonlinear_system/problem12.mos
new file mode 100644
index 00000000000..82c1107da90
--- /dev/null
+++ b/simulation/modelica/nonlinear_system/problem12.mos
@@ -0,0 +1,44 @@
+// name: problem12
+// status: correct
+// teardown_command: rm -f nonlinear_system.problem12* output.log
+
+loadFile("nlsTestPackage.mo"); getErrorString();
+
+simulate(nonlinear_system.problem12); getErrorString();
+
+val(x,{0.0, 0.5, 1.0});
+val(y,{0.0, 0.5, 1.0});
+val(z,{0.0, 0.5, 1.0});
+
+setCommandLineOptions("+d=NLSanalyticJacobian");
+simulate(nonlinear_system.problem12); getErrorString();
+
+val(x,{0.0, 0.5, 1.0});
+val(y,{0.0, 0.5, 1.0});
+val(z,{0.0, 0.5, 1.0});
+
+// Result:
+// true
+// ""
+// record SimulationResult
+//     resultFile = "nonlinear_system.problem12_res.mat",
+//     simulationOptions = "startTime = 0.0, stopTime = 1.0, numberOfIntervals = 500, tolerance = 1e-06, method = 'dassl', fileNamePrefix = 'nonlinear_system.problem12', options = '', outputFormat = 'mat', variableFilter = '.*', cflags = '', simflags = ''",
+//     messages = ""
+// end SimulationResult;
+// "Warning: There are iteration variables with default zero start attribute. Use +d=initialization for more information.
+// "
+// {0.1413741945152485,0.2812491225132911,1.0}
+// {1.000399466692872,1.006256979103416,2.0}
+// {1.940439478068367,3.537907544719854,243.0}
+// true
+// record SimulationResult
+//     resultFile = "nonlinear_system.problem12_res.mat",
+//     simulationOptions = "startTime = 0.0, stopTime = 1.0, numberOfIntervals = 500, tolerance = 1e-06, method = 'dassl', fileNamePrefix = 'nonlinear_system.problem12', options = '', outputFormat = 'mat', variableFilter = '.*', cflags = '', simflags = ''",
+//     messages = ""
+// end SimulationResult;
+// "Warning: There are iteration variables with default zero start attribute. Use +d=initialization for more information.
+// "
+// {0.1413741945152598,0.2812491225131152,1.0}
+// {1.000399466692872,1.0062569791034,2.0}
+// {1.940439478068463,3.537907544717219,243.0}
+// endResult