Apple iWork '09 - Manual (Page 348)

Choosing Which Time Value of Money Function to Use
This section provides additional information regarding the functions used to solve
time value of money problems. Time value of money, or TVM, problems involve cash
flows over time and interest rates. This section contains several parts.
“Regular Cash Flows and Time Intervals” on page 348 discusses the TVM functions used
with regular cash flows, regular time intervals, and fixed interest rates.
“Irregular Cash Flows and Time Intervals” on page 350 discusses the TVM functions
used with irregular cash flows, irregular time intervals, or both.
“Which Function Should You Use to Solve Common Financial Questions?” on page 351
describes several common TVM problems (such as which function would be used to
compute interest on a savings account) along with the functions that might be used in
solving the problem.
Regular Cash Flows and Time Intervals
The primary functions used with regular periodic cash flows (payments of a
constant amount and all cash flows at constant intervals) and fixed interest rates are
interrelated.
Function and its purpose Arguments used by the function
“FV” (page 120) is the function to use if you wish
to determine what the future value (what it is
worth at a future point in time) of a series of cash
flows will be, considering the other factors such
as the interest rate. It solves for the argument
future-value. periodic-rate, num-periods, payment, present-value,
when-due
“NPER” (page 130) is the function to use if you
wish to determine the number of periods it
would take to repay a loan or the number
of periods you might receive an annuity,
considering the other factors such as the interest
rate. It solves for the argument num-periods. periodic-rate, payment, present-value, future-value,
when-due
“PMT” (page 134) is the function to use if you
wish to determine the amount of the payment
that would be required on a loan or received on
an annuity, considering the other factors such as
interest rate. It solves for the argument payment. periodic-rate, num-periods, present-value, future-
value, when-due
348 Chapter 13 Additional Examples and Topics