Uniform Gradient of Cash Flows

Some problems involve receipts or expenses that are projected to increase or decrease by a uniform

amount each period, thus constituting an arithmetic sequence of cash flows.

For example, because of leasing a certain type of equipment, maintenance and repair savings relative to

purchasing the equipment may increase by a roughly constant amount each period. This situation can

be modeled as a uniform gradient of cash flows.

 Relating a Uniform Series to Its
Present & Future Equivalent Values
Cash-flow diagram of a

sequence of end-of-period cash

flows increasing by a constant

amount, , in each period. The

is known as the uniform

gradient amount.
 Relating a Uniform Series to Its
Present & Future Equivalent Values
Note that the timing of cash flows on which the derived formulas and tabled

values are based is as follows:

Finding P when Given G
Finding A when Given G
Finding F when Given G