Total present value
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8 Terms
What question does the total present value answer?
What is the current value of an ANNUITY
What is the difference between the total present value and the present value?
The total present value is used for calculating the present value of an annuity (multiple regular payments), whilst the present value calculates the present value of ONE payment
What is the formula for the Total Present Value?
Total present value = a/r[a-1/(1+r)^n]
![<p>Total present value = a/r[a-1/(1+r)^n]</p>](https://assets.knowt.com/user-attachments/7c46edfe-5930-4348-8679-5a92d76391df.png)
What is the Total Future Value used for?
What will the total value of all the annuities be worth in the end?
What is the formula for the Total Future Value
Total future value = a/r[(1+r)^n-1]
![<p>Total future value = a/r[(1+r)^n-1]</p>](https://assets.knowt.com/user-attachments/07756f71-aa73-4bfb-a6c1-489f7ee66e31.png)
What is the formula for the Total present value of a continuous income stream?
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What is the formula for the Total future value of a continuous income stream?
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What is the formula for a discounted value of a continuous income stream at any time during a period?
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