PV

Calculates the present value of the combination of payments and future value as provided.

Formula Syntax

PV(InterestRate, Period, Payment, FV, AnnuityType)

InterestRate: the interest rate per period (expressed as a decimal, 8% = 0.08).

Period: the number of payments to be made.

Payment: the payment to be made each period.

FV: the future value as of the end of the period.

AnnuityType: indicates whether payments are made at the beginning or end of the period. 0 indicates payments are made at the end of the period. 1 indicates payments are made at the beginning of the period.

Examples

To calculate the present value of a 10-year amortization payment of a $1,037.03 per year paid at the beginning of each year using an 8% interest rate:

PV(.08, 30, 822.48, 0, 1) equals -10,000.05

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