iemisc (version 0.9.9)

PgivenAcont: Present value given Annual value [continuous] (Engineering Economics)

Description

Compute P given A with interest compounded continuously

Usage

PgivenAcont(A, n, r)

Value

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

Arguments

A

numeric vector that contains the annual value(s)

n

numeric vector that contains the period value(s)

r

numeric vector that contains the continuously compounded nominal annual interest rate(s) as a percent

Details

P is expressed as

$$P = A\left[\frac{e^{rn} - 1}{e^{rn}\left(e^{r} - 1\right)}\right]$$

P

the "present equivalent"

A

the "annual equivalent amount (occurs at the end of each year)"

r

the "nominal annual interest rate, compounded continuously"

n

the "number of periods (years)"

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 169.

Examples

library("iemisc")
  PgivenAcont(2000, 3, 12) # the interest rate is 12%