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# future value of an ordinary annuity formula

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n=16

i= 0.043

PMT= \$295

PV= ?

Guest Jul 2, 2017
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#1
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It seems you yourself could set this into a formula as you already know the values (which is the difficult part of deriving the correct values from questions). Would have also helped if you noted the payment time period... I assumed it's an annual payment...

The notation for these values depicts A(P/A, i%, n) = PV

Now to apply the formula:

PV = A((((1+i)^n)-1)/(i*(1+i)^n)

PV = 295((((1.043)^16)-1)/(.043*(1.043)^16)

PV = \$3362.59

In the title it states you want a future value yet in the description you ask for a present value...

Regardless, let's convert the present value to a future value.

FV = 3362.59(1.043^16)

FV = \$6595.12

Guest Jul 3, 2017
edited by Guest  Jul 3, 2017

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