gavin,

It is simply exponential growth:

FV = P(1+r)^periods

where r is the rate of return, expressed as a decimal (5% = 0.05)

Note that return and period basis need to be consistent - 5% per year, then periods is in # of
years.

You can always do the period basis internally

FV = P(1+r/n)^(Y*n)

where n is the number of sub periods per time basis - usually, 12 months per year.....

HTH,
Bernie
MS Excel MVP


"gavin" wrote in message
...
Can anyone tell me the underlying equation used by the FV function expressed
as an algebraic equation? I am creating a flash tool that will do the
calculation online, but need to know what the equation is so that it can be
programmed in.



The FV function uses the following syntax and arguments
FV(rate,nper,pmt,pv,type)
whe
Rate is the interest rate per period.

Nper is the total number of payment periods in an annuity.

Pmt is the payment made each period; it cannot change over the life of the
annuity. If pmt is omitted, you must include the pv argument.

Pv is the present value, or the lump-sum amount that a series of future
payments is worth right now. If pv is omitted, it is assumed to be 0 (zero),
and you must include the pmt argument.

Type is the number 0 or 1 and indicates when payments are due. If type is
omitted, it is assumed to be 0.