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#1
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present value of a future amount
How do I find out the current value of a future amount? Let's assume 10
years from now somebody hands me $10,000. Assuming 4% inflation, how do I determine how much that $10k is worth today? When I look at PV and NPV they seem to want periodic payments which this doesn't have. thanks |
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#2
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present value of a future amount
=PV(0.04/12,120,0,10000,1)
-- If this posting was helpful, please click on the Yes button. Regards, Michael Arch. "xrbbaker" wrote: How do I find out the current value of a future amount? Let's assume 10 years from now somebody hands me $10,000. Assuming 4% inflation, how do I determine how much that $10k is worth today? When I look at PV and NPV they seem to want periodic payments which this doesn't have. thanks |
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#3
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present value of a future amount
Cool. The amount seems intuitively right. Why does it return a negative
number? Thanks much! Russ "Michael" wrote: =PV(0.04/12,120,0,10000,1) -- If this posting was helpful, please click on the Yes button. Regards, Michael Arch. "xrbbaker" wrote: How do I find out the current value of a future amount? Let's assume 10 years from now somebody hands me $10,000. Assuming 4% inflation, how do I determine how much that $10k is worth today? When I look at PV and NPV they seem to want periodic payments which this doesn't have. thanks |
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#4
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present value of a future amount
It's the convention that most financial functions (including Excel) use. By
convention, a negative number is money out of your pocket, and a positive number is money going back into your pocket. However, you can use them whichever way you want as long as you remember they have opposite signs. If you have payments, make sure the sign is correct. -- Regards, Fred "xrbbaker" wrote in message ... Cool. The amount seems intuitively right. Why does it return a negative number? Thanks much! Russ "Michael" wrote: =PV(0.04/12,120,0,10000,1) -- If this posting was helpful, please click on the Yes button. Regards, Michael Arch. "xrbbaker" wrote: How do I find out the current value of a future amount? Let's assume 10 years from now somebody hands me $10,000. Assuming 4% inflation, how do I determine how much that $10k is worth today? When I look at PV and NPV they seem to want periodic payments which this doesn't have. thanks |
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#5
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present value of a future amount
Makes sense. Thanks!
"Fred Smith" wrote: It's the convention that most financial functions (including Excel) use. By convention, a negative number is money out of your pocket, and a positive number is money going back into your pocket. However, you can use them whichever way you want as long as you remember they have opposite signs. If you have payments, make sure the sign is correct. -- Regards, Fred "xrbbaker" wrote in message ... Cool. The amount seems intuitively right. Why does it return a negative number? Thanks much! Russ "Michael" wrote: =PV(0.04/12,120,0,10000,1) -- If this posting was helpful, please click on the Yes button. Regards, Michael Arch. "xrbbaker" wrote: How do I find out the current value of a future amount? Let's assume 10 years from now somebody hands me $10,000. Assuming 4% inflation, how do I determine how much that $10k is worth today? When I look at PV and NPV they seem to want periodic payments which this doesn't have. thanks |
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