Annuity (finance Theory) - Example Calculations

Example Calculations

Formula for Finding the Periodic payment(R), Given A:

R = A/(1+〖(1-(1+(j/m) )〗^(-(n-1))/(j/m))

Examples:

  1. Find the periodic payment of an annuity due of $70000, payable annually for 3 years at 15% compounded annually.
    • R = 70000/(1+〖(1-(1+((.15)/1) )〗^(-(3-1))/((.15)/1))
    • R = 70000/2.625708885
    • R = $26659.46724
  2. Find the periodic payment of an annuity due of $250700, payable quarterly for 8 years at 5% compounded quarterly.
    • R= 250700/(1+〖(1-(1+((.05)/4) )〗^(-(32-1))/((.05)/4))
    • R = 250700/26.5692901
    • R = $9435.71

Finding the Periodic Payment(R), Given S:

R = S,/((〖((1+(j/m) )〗^(n+1)-1)/(j/m)-1)

Examples:

  1. Find the periodic payment of an accumulated value of $55000, payable monthly for 3 years at 15% compounded monthly.
    • R=55000/((〖((1+((.15)/12) )〗^(36+1)-1)/((.15)/12)-1)
    • R = 55000/45.67944932
    • R = $1204.04
  2. Find the periodic payment of an accumulated value of $1600000, payable annually for 3 years at 9% compounded annually.
    • R=1600000/((〖((1+((.09)/1) )〗^(3+1)-1)/((.09)/1)-1)
    • R = 1600000/3.573129
    • R = $447786.80

Read more about this topic:  Annuity (finance Theory)

Other articles related to "calculations, calculation":

Molecular Modeling On GPUs
... cards that could be used not only to show graphics but also for scientific calculations ... this event, the computational power of video cards was used to accelerate calculations ... Quantum chemistry calculations and molecular mechanics simulations (molecular modeling in terms of classical mechanics) are among beneficial applications of this ...
Software Calculator - Related Software Packages
... software packages that provide user-accessible calculation features, but that are not normally called calculators, because the calculation features play only a supporting role rather than being an end in ... These include Spreadsheets, where user-supplied calculations can define a cell’s content ... expressions, including evaluating simple calculations ...
Measurement of Surface Stress - Theoretical Calculations
... have been used such as first principles, atomistic potential calculations and molecular dynamics simulations ... Most of calculations are done at temperature of 0 K ... Details of these calculations could be found in the attached references ...
Software Calculator - History - Early Years
... The software that they ran was naturally used to perform calculations, but it was specially designed for a substantial application that was not limited to ... Software specifically to perform calculations as its main purpose was first written in the 1960s, and the first software package for general calculations to obtain widespread use was released in 1978 ...

Famous quotes containing the word calculations:

    The vulgar call good fortune that which really is produced by the calculations of genius.
    Ralph Waldo Emerson (1803–1882)

    What, really, is wanted from a neighborhood? Convenience, certainly, an absence of major aggravation, to be sure. But perhaps most of all, ideally, what is wanted is a comfortable background, a breathing space of intermission between the intensities of private life and the calculations of public life.
    Joseph Epstein (b. 1937)