iemisc (version 0.9.9)

PgivenG: Present value given Gradient value (Engineering Economics)

Description

Compute P given G

Usage

PgivenG(
  G,
  n,
  i,
  frequency = c("annual", "semiannual", "quarter", "bimonth", "month", "daily")
)

Value

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

Arguments

G

numeric vector that contains the gradient 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

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

P

the "present equivalent"

G

the "uniform gradient amount"

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 142, 150, 152-154.

Examples

library("iemisc")
# Example 4-20 from the Reference text (pages 153-154)
PgivenG(1000, 4, 15, "annual") # the interest rate is 15%