PgivenA: Present value given Annual value (Engineering Economics)

In iemisc: Irucka Embry's Miscellaneous Functions

Present value given Annual value (Engineering Economics)

Description

Compute P given A

Usage

PgivenA(
  A,
  n,
  i,
  frequency = c("annual", "semiannual", "quarter", "bimonth", "month", "daily")
)

PA(
  A,
  n,
  i,
  frequency = c("annual", "semiannual", "quarter", "bimonth", "month", "daily")
)

Arguments

A	numeric vector that contains the annual value(s)
n	numeric vector that contains the period value(s)
i	numeric vector that contains the interest rate(s) as a percent
frequency	character vector that contains the frequency used to obtain the number of periods [annual (1), semiannual (2), quarter (4), bimonth (6), month (12), daily (365)]

Details

P is expressed as

P = A\left[\frac{\left(1 + i\right)^n - 1}{i\left(1 + i\right)^n}\right]

P

the "present equivalent"

A

the "uniform series amount (occurs at the end of each interest period)"

i

the "effective interest rate per interest period"

n

the "number of interest periods"

Value

PgivenA numeric vector that contains the present value(s) rounded to 2 decimal places

PA data.table of both n (0 to n) and the resulting present values rounded to 2 decimal places

Author(s)

Irucka Embry

Source

1. r - Convert column classes in data.table - Stack Overflow answered by Matt Dowle on Dec 27 2013. See https://stackoverflow.com/questions/7813578/convert-column-classes-in-data-table.

2. r - foreach loop not replicating traditional loop - Stack Overflow answered by F. Privé on Oct 19 2019. See https://stackoverflow.com/questions/58459665/r-foreach-loop-not-replicating-traditional-loop.

References

1. William G. Sullivan, Elin M. Wicks, and C. Patrick Koelling, Engineering Economy, Fourteenth Edition, Upper Saddle River, New Jersey: Pearson/Prentice Hall, 2009, page 133-134, 142, 164.

2. Dave Bruns, Exceljet: "Calculate original loan amount", https://exceljet.net/formulas/calculate-original-loan-amount.

Examples

library(iemisc)

# Example 1 -- Example 4-9 from the Sullivan Reference text (page 133-134)
PgivenA(A = 20000, n = 5, i = 15, frequency = "annual") # the interest rate is 15%

PA(20000, 5, 15, "annual") # the interest rate is 15%


# Example 2

PgivenA(A = 93.22, n = 5, i = 4.50, frequency = "month")

# Using LibreOffice Calc 6.1.5.2 version
# A1 4.50%
# A2 -93.22
# A3 60
# A4 12
# A5 =PV(A1/A4,A3,A2) = $5,000.26

iemisc documentation built on Sept. 25, 2023, 5:09 p.m.