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Present Value of Ordinary Annuities and Amortization Formula

GoPresent Value of Future Sum given compounding periods Formula

GoPresent Value of Future Sum given Total Number of Periods Formula

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The Present Value of the annuity is the value that determines the value of a series of future periodic payments at a given time. Check FAQs

PV = PMT \cdot (\frac{1 - {(1 + r)}^{- n c}}{r})

PV - Present Value?PMT - Payment made in Each Period?r - Rate per Period?n_c - Total Number of Times Compounded?

Present Value of Ordinary Annuities and Amortization Example

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Here is how the Present Value of Ordinary Annuities and Amortization equation looks like with Values.

Here is how the Present Value of Ordinary Annuities and Amortization equation looks like with Units.

Here is how the Present Value of Ordinary Annuities and Amortization equation looks like.

593.9185 = 60 \cdot (\frac{1 - {(1 + 0.05)}^{- 14}}{0.05})

593.9185 = 60 \cdot (\frac{1 - {(1 + 0.05)}^{- 14}}{0.05})

593.9185 = 60 \cdot (\frac{1 - {(1 + 0.05)}^{- 14}}{0.05})

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Present Value of Ordinary Annuities and Amortization Solution

Follow our step by step solution on how to calculate Present Value of Ordinary Annuities and Amortization?

FIRST Step Consider the formula

PV = PMT \cdot (\frac{1 - {(1 + r)}^{- n c}}{r})

Next Step Substitute values of Variables

∴

PV = 60 \cdot (\frac{1 - {(1 + 0.05)}^{- 14}}{0.05})

Next Step Prepare to Evaluate

∴

PV = 60 \cdot (\frac{1 - {(1 + 0.05)}^{- 14}}{0.05})

Next Step Evaluate

∴

PV = 593.918456405378

LAST Step Rounding Answer

∴

PV = 593.9185

Present Value of Ordinary Annuities and Amortization Formula Elements

Variables

Present Value

The Present Value of the annuity is the value that determines the value of a series of future periodic payments at a given time.

Symbol: PV

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Present Value

Payment made in Each Period

Payment made in Each Period refers to the regular cash outflow or disbursement of funds that occurs at consistent intervals over a specified period of time.

Symbol: PMT

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Payment made in Each Period

Rate per Period

The Rate per Period is the interest rate charged.

Symbol: r

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Rate per Period

Total Number of Times Compounded

Total Number of Times Compounded refers to the frequency with which interest is calculated and added to the principal amount in a compounding interest scenario.

Symbol: n_c

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Total Number of Times Compounded

Other Formulas to find Present Value

Go Present Value of Future Sum given compounding periods

PV = \frac{FV}{{(1 + (\frac{%RoR}{C n}))}^{C n \cdot n Periods}}

Go Present Value of Future Sum given Total Number of Periods

PV = \frac{FV}{{(1 + IR)}^{t}}

Go Present Value of Future Sum given Number of Periods

PV = \frac{FV}{\exp (%RoR \cdot n Periods)}

Other formulas in Present Value category

Go Present Value of Annuity

PVAnnuity = (\frac{p}{IR}) \cdot (1 - (\frac{1}{{(1 + IR)}^{n Months}}))

Go Present Value of Lumpsum

PV L = \frac{FV}{{(1 + IR P)}^{n Periods}}

Go Present Value of Growing Annuity

PV ga = (\frac{II}{r - g}) \cdot (1 - {(\frac{1 + g}{1 + r})}^{n Periods})

Go Present Value of Stock with Constant Growth

P = \frac{D1}{(%RoR \cdot 0.01) - g}

How to Evaluate Present Value of Ordinary Annuities and Amortization?

Present Value of Ordinary Annuities and Amortization evaluator uses Present Value = Payment made in Each Period*((1-(1+Rate per Period)^(-Total Number of Times Compounded))/Rate per Period) to evaluate the Present Value, The Present Value of Ordinary Annuities and Amortization formula is defined as refers to the current value of a series of equal periodic payments or receipts occurring at the end of each period over a specified time frame, discounted back to the present at a given interest rate. Present Value is denoted by PV symbol.

How to evaluate Present Value of Ordinary Annuities and Amortization using this online evaluator? To use this online evaluator for Present Value of Ordinary Annuities and Amortization, enter Payment made in Each Period (PMT), Rate per Period (r) & Total Number of Times Compounded (n_c) and hit the calculate button.

FAQs on Present Value of Ordinary Annuities and Amortization

What is the formula to find Present Value of Ordinary Annuities and Amortization?

The formula of Present Value of Ordinary Annuities and Amortization is expressed as Present Value = Payment made in Each Period*((1-(1+Rate per Period)^(-Total Number of Times Compounded))/Rate per Period). Here is an example- 212.757 = 60*((1-(1+0.05)^(-14))/0.05).

How to calculate Present Value of Ordinary Annuities and Amortization?

With Payment made in Each Period (PMT), Rate per Period (r) & Total Number of Times Compounded (n_c) we can find Present Value of Ordinary Annuities and Amortization using the formula - Present Value = Payment made in Each Period*((1-(1+Rate per Period)^(-Total Number of Times Compounded))/Rate per Period).

What are the other ways to Calculate Present Value?

Here are the different ways to Calculate Present Value-

Present Value=Future Value/(1+(Rate of Return/Compounding Periods))^(Compounding Periods*Number of Periods)
Present Value=Future Value/(1+Interest Rate)^Total Number of Periods
Present Value=Future Value/exp(Rate of Return*Number of Periods)

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Present Value of Ordinary Annuities and Amortization Formula

​GoPresent Value of Future Sum given compounding periods Formula

​GoPresent Value of Future Sum given Total Number of Periods Formula

Present Value of Ordinary Annuities and Amortization Example

Present Value of Ordinary Annuities and Amortization Solution

Present Value of Ordinary Annuities and Amortization Formula Elements

Other Formulas to find Present Value

Other formulas in Present Value category

How to Evaluate Present Value of Ordinary Annuities and Amortization?

FAQs on Present Value of Ordinary Annuities and Amortization

Variable Name

GoPresent Value of Future Sum given compounding periods Formula

GoPresent Value of Future Sum given Total Number of Periods Formula