Present Value of Lumpsum Solution

STEP 0: Pre-Calculation Summary
Formula Used
Present Value of Lumpsum = Future Value/(1+Interest Rate per Period)^Number of Periods
PVL = FV/(1+r)^n
This formula uses 4 Variables
Variables Used
Present Value of Lumpsum - Present Value of Lumpsum is the current worth of a future sum of money, discounted at a certain rate of return or interest rate.
Future Value - Future Value is the calculated future value of any investment.
Interest Rate per Period - Interest Rate per Period refers to the rate at which interest is applied or accrued over a single time period.
Number of Periods - The Number of Periods is the periods on an annuity using the present value, periodic payment, and periodic rate.
STEP 1: Convert Input(s) to Base Unit
Future Value: 33000 --> No Conversion Required
Interest Rate per Period: 0.05 --> No Conversion Required
Number of Periods: 2 --> No Conversion Required
STEP 2: Evaluate Formula
Substituting Input Values in Formula
PVL = FV/(1+r)^n --> 33000/(1+0.05)^2
Evaluating ... ...
PVL = 29931.9727891156
STEP 3: Convert Result to Output's Unit
29931.9727891156 --> No Conversion Required
FINAL ANSWER
29931.9727891156 29931.97 <-- Present Value of Lumpsum
(Calculation completed in 00.004 seconds)

Credits

Created by Vishnu K
BMS College of Engineering (BMSCE), Bangalore
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Present Value of Lumpsum
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Present Value of Lumpsum Formula

Present Value of Lumpsum = Future Value/(1+Interest Rate per Period)^Number of Periods
PVL = FV/(1+r)^n

What is Present Value of Lumpsum?

The present value of a lump sum is a financial concept that evaluates the current worth of a future cash amount, factoring in the time value of money. This calculation is rooted in the understanding that a sum of money available in the future is not as valuable as the same amount in hand today. By discounting the future value at a specific interest rate, the present value represents the amount one would need now to be equivalent to the anticipated future sum.

How to Calculate Present Value of Lumpsum?

Present Value of Lumpsum calculator uses Present Value of Lumpsum = Future Value/(1+Interest Rate per Period)^Number of Periods to calculate the Present Value of Lumpsum, The Present Value of Lumpsum formula is defined as the current worth of a future sum of money, discounted at a certain rate of return or interest rate. Present Value of Lumpsum is denoted by PVL symbol.

How to calculate Present Value of Lumpsum using this online calculator? To use this online calculator for Present Value of Lumpsum, enter Future Value (FV), Interest Rate per Period (r) & Number of Periods (n) and hit the calculate button. Here is how the Present Value of Lumpsum calculation can be explained with given input values -> 29931.97 = 33000/(1+0.05)^2.

FAQ

What is Present Value of Lumpsum?
The Present Value of Lumpsum formula is defined as the current worth of a future sum of money, discounted at a certain rate of return or interest rate and is represented as PVL = FV/(1+r)^n or Present Value of Lumpsum = Future Value/(1+Interest Rate per Period)^Number of Periods. Future Value is the calculated future value of any investment, Interest Rate per Period refers to the rate at which interest is applied or accrued over a single time period & The Number of Periods is the periods on an annuity using the present value, periodic payment, and periodic rate.
How to calculate Present Value of Lumpsum?
The Present Value of Lumpsum formula is defined as the current worth of a future sum of money, discounted at a certain rate of return or interest rate is calculated using Present Value of Lumpsum = Future Value/(1+Interest Rate per Period)^Number of Periods. To calculate Present Value of Lumpsum, you need Future Value (FV), Interest Rate per Period (r) & Number of Periods (n). With our tool, you need to enter the respective value for Future Value, Interest Rate per Period & Number of Periods and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.
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