# PRESENT VALUE Function

The PRESENT VALUE function calculates the present value of a loan or an investment, based on a constant interest rate.

If you know the rate, term, payment, future value and type of a savings scheme or loan you can use the PRESENT VALUE function to work out how much the investment is worth currently (i.e. how much money you need to invest over the same amount of payment periods to equal the return)

Function name |
PRESENT VALUE |

Usage model | PRESENT VALUE ( rate:NUM, term:NUM, payment:NUM, future value:NUM, type:NUM ) |

Parameters | This function requires you to replace three of five parameters (two are optional): |

rate: NUM |
The function uses this value as the interest rate per payment period. |

term: NUM |
The function uses this value as the total number of payment periods. |

payment: NUM |
The function uses this value as the paid amount in each payment period. |

future value: NUM |
(Optional) This represents the value after the last payment period, the default is zero. |

type: NUM |
(Optional) This value can be entered as a 0 or a 1, 0 meaning payments are due at the end of a payment period and 1 meaning payments are due at the beginning of a payment period. The default is zero. |

Result | A number value. |

## Example

For example, if you have an annual rate of 7.5% over 3 years, paying $100 a month and you know that the future value is $4,023.1381682 then you can work out the PRESENT VALUE by using the following figures:

SET RateNUM TO 0.00625 //(0.075/12 to find the monthly rate)

SET TermNUM TO 36 //(amount of months in 3 years)

SET PaymentNUM TO -100

SET FutureValueNUM TO 4023.1381682

SET TypeNUM TO 0

PRESENT VALUE ( 0.00625, 36, -100, 4023.1381682, 0 )

This produces the result of the Future Value being 0

See Also:

RATE

TERM

PAYMENT

FUTURE VALUE