Join Curt Frye for an in-depth discussion in this video FV: Calculating the future value of an investment, part of Excel 2010: Financial Functions in Depth.
One of the more conservative investment strategies is to purchase a certificate…of deposit or another fixed-rate annuity that trades lower risk for a relatively…low but known rate of return.…You can evaluate this type of investment using the future value or FV function.…The FV function has five arguments and I've laid those out in this workbook.…The first is the rate and that is the annual percentage rate.…Then next is periods and that is the number of periods over which interest…will be accumulated.…
So in this case, I have it set as 5 years.…Then the next argument is the payment and this is the payment that you make every period.…So for example in this case every year you'll put in an additional $10,000.…Then we have the present value and that is $100,000 and that's the amount…that you start with.…You can think of it as a down payment on a house for example.…Now both present value and payment are negative numbers, so they're displayed in parentheses.…And the reason they're negative is because it's money that is flowing out of…
- Analyzing loans, payments, and interest
- Discovering the interest rate of an annuity
- Determining depreciation using the straight line, declining balance, double-declining balance, and other methods
- Calculating the future value of an investment with variable returns
- Finding the discount rate of a security
- Converting between fractional prices and decimal prices
- Determining the yield of securities that pay interest periodically
Skill Level Intermediate
Managing and Analyzing Data in Excel 2010with Dennis Taylor1h 32m Appropriate for all
Excel 2010: Data Validation in Depthwith Dennis Taylor59m 45s Intermediate
1. Analyzing Loans, Payments, and Interest
2. Calculating Depreciation
3. Determining Values and Rates of Return
4. Calculating Bond Coupon Dates and Security Durations
5. Calculating Security Prices and Yields
6. Calculating Prices and Yields of Securities with Odd Periods
Additional resources1m 5s
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