pv_present_value_.htm

Navigation: Templates > Guide to all Templates > Additional Libraries and Templates > Finance Library >====== PV (present value) ====== | |

**PV**(*periods,rate,payment,futurevalue*)

PV | Computes the present value required to reach a targeted future value. |

periods | A numeric constant or variable containing the number of periods in which a cash flow occurred. |

rate | A numeric constant or variable containing the periodic rate of return. |

payment | A numeric constant or variable containing the periodic payment amount. |

futurevalue | A numeric constant or variable containing the amount of the desired or targeted future value of the investment. |

**PV **determines the present value required today to reach a desired amount (*futurevalue*) based upon the total number of periods (*periods*), a periodic interest rate (*rate*), and a payment amount (*payment*). If payments occur at the beginning of each period then use the **PREPV **function, which takes into account the added interest earned on each period's payment.

Periodic rate may be calculated as follows:

PeriodicRate = AnnualInterestRate / (PeriodsPerYear * 100)

If the present value is less than the future value (annuities), payments are positive, and conversely, if the present value is greater than the future value (loans), payments are negative.

**Return Data Type:** DECIMAL

**Internal Formulas:**

where frac(periods) is the fractional portion of the *periods *parameter.

**Example:**

** PeriodicRate = AnnualRate / (PeriodsPerYear * 100)**

** IF TimeOfPayment = 'Beginning of Periods'**

** PresentValue = PREPV(TotalPeriods,PeriodicRate,Payment,FutureValue)**

** ELSE**

** PresentValue = PV(TotalPeriods,PeriodicRate,Payment,FutureValue)**

** END**

pv_present_value_.htm.txt · Last modified: 2021/04/15 15:57 (external edit)