Present value of an annuity

Input(s)

$i_{e}$: Effective Interest or Discount Rate (fraction)

$\mathrm{t}$: Time (year)

$A_{v}$: Annuity (currency unit)

Output(s)

$P_{v}$: Present Value of an Annuity (currency unit)

Formula(s)

$$ P_{v}=A_{v} * \frac{\left(\left(1+i_{e}\right)^{t}\right)-1}{i_{e} *\left(1+i_{e}\right)^{t}} $$

Reference(s)

Mian, M. A. 2011. Project Economics and Decision Analysis Volume 1: Deterministic Models, Second Edition. Tulsa, Oklahoma: PennWell Corporation. Chapter 2, Page: 57.