Time Value of Money – Formulas
Are there any multiple (>1) payments, deposits, cash flows?
No
Yes
Single payment…
Multiple payments…
Question about Future Payment?
No
Present Value
Yes
Future Value
Are payments equal?
No
Yes
Annuity
Mixed cash stream
Calculate FV or PV
for each payment
and sum them up.
Question about Future Payment?
No
Present Value
PVAn  PMT  PVIFAr ,n
PMT 
r  PVA
1  (1  r ) n
 r  PVA 
ln 1 

PMT 

n
ln 1  r 
Yes
Future Value