Syntax

Pv(Rate,NPer,Pmt,Fv,Due)

Description

Calculates the present value of an annuity based on future periodic fixed payments and a constant rate of interest.

Comments

The Pv function requires the following parameters:

Parameter

Description

Rate

Double representing the interest rate per period. When used with monthly payments, be sure to normalize annual percentage rates by dividing them by 12.

NPer

Double representing the total number of payments in the annuity.

Pmt

Double representing the amount of each payment per period.

Fv

Double representing the future value of the annuity after the last payment has been made. In the case of a loan, the future value would be 0.

Due

Integer indicating when the payments are due for each payment period. A 0 specifies payment at the end of each period, whereas a 1 specifies payment at the start of each period.

Rate and NPer must be expressed in the same units. If Rate is expressed in months, then NPer must also be expressed in months.

Positive numbers represent cash received, whereas negative numbers represent cash paid out.

Example

This example demonstrates the present value (the amount you'd have to pay now) for a $100,000 annuity that pays an annual income of $5,000 over 20 years at an annual interest rate of 10%.

Sub Main()
  pval = Pv(.1,20,-5000,100000,1)
  MsgBox "The present value is: " & Format(pval,"Currency")
End Sub

See Also

Fv (function); IRR (function); MIRR (function); Npv (function).

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