| pvYearlyAnnuityCompDaily {tvmComp} | R Documentation |
Computing Present Value of Yearly Paid Ordinary Annuity or Annuity Due that is Compounded Daily.
Description
Computing Present Value of Yearly Paid Ordinary Annuity or Annuity Due that is Compounded Daily.
Usage
pvYearlyAnnuityCompDaily(r, n, pmt, bgn)
Arguments
r |
A number. |
n |
A number. |
pmt |
A number. |
bgn |
A number. |
Details
As described by Titman,S. et al. (2017), Time Value of Money calculations are essentially comparisons between Present Value, that is what a cash flow is worth today, and Future Value, that is what a cash flow will be worth in the future. The Future Value is impacted by the frequency of compounding. In most of the Time Value of Money situations the compounding period is an Year in length. However, this is not always true. For instance, banks often offer saving accounts that compound the interest every day, month, or quarter. Depositor, in this scenario, should prefer more frequent compounding because more interest is earned when interest is compounded more frequently. Most common compounding situations include daily, monthly, quarterly and yearly compounding.
The method pvYearlyAnnuityCompDaily() is developed to compute Present Value of Yearly-Paid Ordinary Annuity or Annuity Due that is compounded daily. The method gives PResent Value when values are passed to its four arguments. Here r is annual rate, n is number of years,pmt is amount of one annuity and bgn is the computational mode. (Enter 1 when annuity payment occurs at the beginning of the period; 0 for end of period payments).
Value
Input values to four arguments r , n , pmt and bgn
Author(s)
MaheshP Kumar, maheshparamjitkumar@gmail.com
References
Titman,S., Keown,A.J., Martin,J.D. (2017). Financial Management: Principles and Applications(13th Edition). Pearson Education (US). ISBN 9780134417219, https://bookshelf.vitalsource.com/books/9780134418001.
Examples
pvYearlyAnnuityCompDaily(0.11,4,-300,0)
pvYearlyAnnuityCompDaily(0.11,4,-300,1)
pvYearlyAnnuityCompDaily(0.11,4,300,0)
pvYearlyAnnuityCompDaily(0.11,4,300,1)