PV
The present value of payments each period and a future value, at a constant rate.
Group: Financial. Compatible with DAX.
Syntax
PV ( <rate>, <nper>, <pmt> [, <fv>] [, <type>] )| Parameter | Type | Description |
|---|---|---|
rate | Number | The interest rate per period. For monthly payments on a yearly rate, divide that rate by 12. |
nper | Number | How many payment periods there are, all told. |
pmt | Number | The amount paid every period, the same each time. |
fv | Number optional | A lump sum at the end; 0 when left out. |
type | Number optional | When the payments fall: 0 (when left out) at the end of each period, 1 at its start. |
Returns
Number. What the payments, and the lump sum, are worth today.
Remarks
- Cash going out is negative, cash coming in positive. A loan you take is a positive pv, so the payments on it come out negative; a deposit you make is negative. Payments received give a negative present value: what you would pay now to get them.
- Give rate and nper in the same period: 6 % a year paid monthly for 4 years is a rate of 0.06 / 12 and an nper of 48.
- With a rate of 0 it is simply −(fv + pmt × nper).
Examples
What a lease income is worth today
12,000 a month for five years, discounted at 6 % a year.
EVALUATE
ROW (
"Present value", PV ( 0.06 / 12, 60, 12000 ),
"Payments in all", 60 * 12000
)| Present value | Payments in all |
|---|---|
| -620706.729013572 | 720000 |