We can use a simple formula to calculate the present value of a perpetuity annuity. This formula will tell us what a perpetuity is worth based on a discount rate, or a required rate of return.

Here’s what you need to know about two terms related to annuities — present value and future value. Present value of an annuity vs. future value of an annuity: What’s the di ...

The following formula is used to calculate an annuity’s present value. Keep in mind this is the formula for the present value of an ordinary annuity.

Find out how the annuity formula works and how to calculate present and future value. Get a simple breakdown of key concepts.

Find out how the annuity formula works and how to calculate present and future value. Get a simple breakdown of key concepts.

The interest rate can also be a discount rate, such as the current rate of inflation; in this case, the annuity formula discounts a series of future payments to calculate their present value.

Find out how to use Microsoft Excel to calculate the present value of a fixed annuity, including a calculation example. The calculation doesn't account for taxes.

Perpetuity is a financial concept that calculates the value of an investment which gives a steady income to infinity. Learn ...

Richard Followill, PRESENT VALUE AND FUTURE VALUE OF AN ANNUITY GROWING BY A CONSTANT AMOUNT, Journal of Financial Education, No. 18 (Fall 1989), pp. 15-18 ...

Formula for the Future Value of an Annuity. Annuities are investment contracts sold by financial institutions like insurance companies and banks (generally referred to as the annuity issuer). When ...

The authors find that these attributes directly influence consumer preferences beyond their impact on the annuity's expected present value. The strength of the direct influence depends on how ...