Apple iWork '09 - Manual (Page 142)

 when-due: An optional argument that specifies whether payments are due at the
beginning or end of each period. Most mortgage and other loans require the first
payment at the end of the first period (0), which is the default. Most lease and rent
payments, and some other types of payments, are due at the beginning of each
period (1).
end (0 or omitted): Payments are due at the end of each period.
beginning (1): Payments are due at the beginning of each period.
Usage Notes
 periodic-rate is specified using the time frame of num-periods. For example, if num-
periods represents months and the annual interest rate is 8%, periodic-rate must be
specified as 0.00667 or 0.667% (0.08 divided by 12).
If
 payment is specified and there is no investment value, cash value, or loan balance
remaining, future-value may be omitted.
If
 payment is omitted, you must include future-value.
Example 1
Assume you are planning for your daughter’s college education. She has just turned 3 and you
expect she will begin college in 15 years. You think you will need to have $150,000 set aside in a
savings account by the time she reaches college. You can add $200 to the account at the end of each
month. Over the next 15 years, the savings account is expected to earn an annual interest rate of
4.5%, and earns interest monthly.
Using the PV function, you can determine the amount that must be deposited to this savings
account today so that the value of the savings account will reach $150,000 by the time your daughter
begins college. Based on the assumptions given, the function returns –$50,227.88 as the amount that
would need to be deposited today (function returns a negative because the deposit to the savings
account today is a cash outflow).
periodic-rate num-periods payment future-value when-due
=PV(B2, C2, D2,
E2, F2) =0.045/12 =15*12 -200 150000 1
142 Chapter 6 Financial Functions