Time Value of Money Formula Sheet

# Time Value of Money Formula for Annual Intra Year Continuous

Future and Present Value of Lump Sum:
1 Future Value by Sample Interest SIn = P + (P * i * n) Nil Nil
n n*m i*n
2 Future Value by Compound Interest FVn = PV * (1 + i) FVn = PV * (1 + i / m) FVn = PV * e
3 Future Value by Factor Formula FVn = PV * (FVIF i , n) FVn = PV * (FVIF i / m , n * m) FVn = PV * e (i/m) * (n*m) #

4 Present Value of Single Cash Flow PVn = FV / (1 + i) n PVn = FV / (1 + i / m) n*m PVn = FV / e i*n
5 Present Value by Factor Formula PVn = FV * (PVIF i, n) PVn = FV * (PVIF i/m, n*m) PVn = FV / e (i/m)* (n*m)
Future and Present Value of Annuity:
6 Future Value of Constant Cash Flow (CCF) O. Annuity FVAn = CCF [(1 + i) n - 1 / i] %
FVAn = CCF [(1 + i/m) n * m - 1 / i/m] FVAn = CCF [(ei * n - 1) / (ei - 1)]
7 Future Value of Ordinary Annuity by Factor Formula FVAn = CCF * (FVIFA i, n) FVAn = CCF * (FVIFA i/m, n*m) FVAn = CCF [(e (i/m) * n*m )
- 1) / (ei/m - 1)] ##

8 Future Value of Constant Cash Flow (CCF) Annuity Due FVADue = CCF [(1 + i) n - 1 / i] * (1+i) %%
FVADue = CCF [(1 + i/m) n*m - 1 / (i/m)] * (1+i/m) Nil
9 Future Value of Annuity Due by Factor Formula FVADue = CCF * (FVIFA i, n) * (1 + i) FVADue = CCF * (FVIFA i/m, n*m) * (1 + i/m) Nil
n # n*m -i*n
10 Present Value of Constant Cash Flow (CCF) O. Annuity PVAn = CCF [1-{1 / (1+i) } / i] PVAn = CCF [1-{1 / (1+i/m) } / i/m] PVAn = CCF [{(1-e) } / {(e i – 1)}]
-(i/m) * (n*m)
11 Present Value of Ordinary Annuity by Factor Formula PVAn = CCF * (PVIFA i, n) PVAn = CCF * (PVIFA i/m, n*m) PVAn = CCF [{(1-e) } / {(e i/m – 1)}]###
12 Present Value of Constant Cash Flow (CCF) Annuity Due PVADue = CCF [1-{1 / (1+i) n} / i] * (1+i) ##
PVADue= CCF [1-{1 / (1+i/m) n*m} / i/m] * (1+i/m) Nil
13 Present Value of Annuity Due by Factor Formula PVADue = CCF * (PVIFA i, n) * (1+i) PVADue = CCF * (PVIFA i/m, n*m) * (1+i/m) Nil
Special Applications:
14 Perpetuity PVp = CCF / i Nil Nil
Effective Annual Rate when Annual Percentage Rate is
15 given EAR = i EAR = (1 +APR / m) m - 1 Nil
1/m
16 Annual Percentage when Effective Annual Rate is given i = EAR i = m [(1 + EAR) - 1] Nil
17 Real Interest Rate RIR = NR - IR Nil Nil
18 Rule of Doubling n = 72 / i n = 0.35 + 69 / i Nil
The length of time required for a single cash flow to grow
19 to a specified future amount at a given rate of interest n = {Log (FV / PV)} / {Log (1 + i)} n = {Log (FV / PV)} / {m * Log (1 + i/m)} n = 1/i {Log (FV / PV)
The simple rate of interest required for a single cash flow
20 to grow to a specified future cash flow. i = {(FV/PV) 1 / n} - 1 i = m {(FV / PV) 1 / (n * m)} - 1 i = 1/n {In (FV / PV)}
The length of time required for a series of constant cash
21 flows to grow to a specific future amount. n = In {(FVA) (i) / CCF + 1} In (1 + i) n = In {(i/m) (FVA/CCF) + m/i} / [m * {In (1 + i\m}] Nil
Present value of a finite series of cash flows growing at a
22 constant rate (g) for (n) periods with constant (i). PV = {CCF (1 + g) / (i - g)} * [1-{1+g) / (1 + i} n] Nil Nil
#, ##, ###
Continuous Compound and Discounting do not have factor formulas. These line use for Intra Year in case of continuous compounding and discounting.
%
FVAn = CCF (1 + i) n-1 + CCF (1 + i) n-2 + CCF (1 + i) n-3 + ………. + CCF (1 + i) n-n
%%
FVADue = CCF (1 + i) 1 + CCF (1 + i) 2 + CCF (1 + i) 3 + ………. + CCF (1 + i) n or FVADue = Future Value of Ordinary Annuity (1 + i)
#
PVAn = CCF (1/1+i) 1 + CCF (1/1+i) 2 + CCF (1/1+i) 3 + ………. + CCF (1/1+i) n
##
PVAn = CCF (1/1+i) n-1 + CCF (1/1+i) n-22 + CCF (1/1+i) n-3 + ………. + CCF (1/1+i) n-n or PVADue = Present Value of Ordinary Annuity (1 + i)
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