iemisc (version 0.9.9)

PgivenA: Present value given Annual value (Engineering Economics)

Description

Compute P given A

Usage

PgivenA(
  A,
  n,
  i,
  frequency = c("annual", "semiannual", "quarter", "bimonth", "month", "daily")
)
PA(
  A,
  n,
  i,
  frequency = c("annual", "semiannual", "quarter", "bimonth", "month", "daily")
)

Value

PgivenA numeric vector that contains the present value(s) rounded to 2 decimal places

PA data.frame of both n (0 to n) and the resulting present values rounded to 2 decimal places

Arguments

A

numeric vector that contains the annual value(s)

n

numeric vector that contains the period value(s)

i

numeric vector that contains the interest rate(s) as a percent

frequency

character vector that contains the frequency used to obtain the number of periods [annual (1), semiannual (2), quarter (4), bimonth (6), month (12), daily (365)]

Details

P is expressed as

$$P = A\left[\frac{\left(1 + i\right)^n - 1}{i\left(1 + i\right)^n}\right]$$

P

the "present equivalent"

A

the "uniform series amount (occurs at the end of each interest period)"

i

the "effective interest rate per interest period"

n

the "number of interest periods"

References

William G. Sullivan, Elin M. Wicks, and C. Patrick Koelling, Engineering Economy, Fourteenth Edition, Upper Saddle River, New Jersey: Pearson/Prentice Hall, 2009, page 133-134, 142, 164.

Examples

library("iemisc")
# Example 4-9 from the Reference text (page 133-134)
PgivenA(20000, 5, 15, "annual") # the interest rate is 15%

PA(20000, 5, 15, "annual") # the interest rate is 15%