Excel formula PV help needed

  • Thread starter Thread starter junk
  • Start date Start date
J

junk

I need help with a formula

using the PV function I need to creat a formula that calculates the amount
of money required today to be worth 142,500 in 10 years.
Interest rate is 6%
Payment per year is 1
No additional payments will be required



Thanks for the help
 
using the PV function I need to creat a formula that calculates the
amount of money required today to be worth 142,500 in 10 years.
Interest rate is 6%
Payment per year is 1
No additional payments will be required
Click to expand...

=pv(6%, 10, 0, -142500)

I choose to negate the future value so that PV() returns a positive
number.
 
using the PV function I need to creat a formula that calculates the amount
of money required today to be worth 142,500 in 10 years.
Interest rate is 6%
Payment per year is 1
No additional payments will be required
Click to expand...
=pv(6%, 10, 0, -142500)
Click to expand...

I interpreted "payment per year is 1" to mean that the compounding
frequency is annual.

If "payment" means that you will be making annual contributions, then
you want the PMT() function, not the PV() function. Perhaps:

=pmt(6%, 10, 0, -142500)

Again, signs are chosen arbitrarily so that PMT() returns a positive
number.
 
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