1.
Module 13AB
ANNUITY CALCULATIONS
OBJECTIVE:
This program deals with the calculation of both the present value and future value of annuities, as well
as the calculation of the amount of each payment (annuity) if the present or future value of the annuity is
given.
INPUTS (will appear in blue):
The required inputs are specified at the beginning of each example
and worksheet. The interest rate is to be entered as a decimal.
Sample data have been entered as an example.
I. CALCULATING THE PRESENT AND FUTURE VALUES OF ANNUITIES
A. Present value of an annuity
Enter the amount of each payment, A (in cell E27), the interest rate,
i (in cell F27), and the number of payments, n (in cell G27).
What is the present value of this annuity?
A i n
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Enter variables: 1000 0.08 5
-------------- -------------- --------------
Answer: 3992.71
B. Future value of an annuity
Enter the amount of each payment, A (in cell E40), the interest
rate, i (in cell F40), and the number of payments, n (in cell G40).
What is the future value of this annuity?
A i n
-------------- -------------- --------------
Enter variables: 1000 0.08 5
-------------- -------------- --------------
Answer: 5866.60
II. CALCULATING THE ANNUITY
A. Present value
2.
Enter the present value of the annuity, PVA (in cell E55), the
interest rate, i (in cell F55), and the number of payments, n (in
cell G55). What is the amount of each annuity payment?
PVA i n
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Enter variables: 5000 0.08 5
-------------- -------------- --------------
Answer: 1252.28
B. Future value
Enter the future value of the annuity, FVA (in cell E68), the
interest rate, i (in cell F68), and the number of payments, n (in
cell G68). What is the amount of each annuity payment?
FVA i n
-------------- -------------- --------------
Enter variables: 10000 0.08 5
-------------- -------------- --------------
Answer: 1704.56
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