FN 3105 - FINANCIAL MANAGEMENT

MID TERM FORMULA SPREADSHEET

Continues
Annual Compounding (m) Compounding per year
Compounding
Simple Interest FV=PV (1+i * n) PV=FV / (1+i* n) I=P*i* n
nm
 i 
Future Value ( FVi,n ) F V = P V ( 1 + i )n FV = PV 1 +  FV = PVeit
 m
- nm
-n  i 
Present Value ( PVi,n ) PV = FV ( 1 + i ) PV = FV 1 +  PV = FVe-it
 m
Future Value of Annuity
 ( 1 + i )n - 1   (1 + (i / m) )nm − 1
(FVAi,n )
FVA = PMT   FVA = PMT  
 i   i/m 
Future Value of Annuity
FV Annuity Due = FVA*(1+ i ) FV Annuity Due = FVA*(1+ ieffective )
Due

Present Value of Annuity 1 - ( 1 + i )- n  1 - ( 1 + (i / m) )- nm 

(PVAi,n )
PVA = PMT   PVA = PMT  
 i   i/m 
Present Value of Annuity
PV Annuity Due = PVA*(1+ i ) PV Annuity Due = PVA*(1+ ieffective )
Due

Present Value of PMT PMT

PVperpetuity = PVperpetuity =
Perpetuity
i [(1 + i)1/ m − 1]
Effective Annual Interest
Rate EAR = [1+ Quoted Interest Rate/m]m-1
Interpolation Formula y2 = 𝑦1 + (𝑦3 − 𝑦1) ∗ (𝑥2 − 𝑥1/ 𝑥3 − 𝑥1)