Level Perpetuity
Solves for the present value, interest rate, or the amount of the payments for a level perpetuity.
perpetuity.level(pv=NA,pmt=NA,i=NA,ic=1,pf=1,imm=TRUE)
pv |
present value |
pmt |
value of level payments |
i |
nominal interest rate convertible ic times per year |
ic |
interest conversion frequency per year |
pf |
the payment frequency- number of payments per year |
imm |
option for perpetuity immediate or annuity due, default is immediate (TRUE) |
Effective Rate of Interest: eff.i=(1+\frac{i}{ic})^{ic}-1
j=(1+eff.i)^{\frac{1}{pf}}-1
Perpetuity Immediate:
pv=pmt*{a_{≤ft. {\overline {\, ∞ \,}}\! \right |j}}=\frac{pmt}{j}
Perpetuity Due:
pv=pmt*{\ddot {a}_{≤ft. {\overline {\, ∞ \,}}\! \right |j}}=\frac{pmt}{j}*(1+i)
Returns a matrix of the input variables and calculated unknown variables.
One of pv, pmt, or i must be NA (unknown).
Kameron Penn and Jack Schmidt
perpetuity.level(pv=100,pmt=NA,i=.05,ic=1,pf=2,imm=TRUE) perpetuity.level(pv=100,pmt=NA,i=.05,ic=1,pf=2,imm=FALSE)
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