PVLUMPSUM() calculates the present value of a lump sum that is due in a number of periods.
Use PVLUMPSUM() to determine the present value of an amount to be received or paid in the future. The present value is the amount that a payment due in the future is worth today, based on an assumed interest rate. For example, if you owe money at a future date, the present value is the amount you need to put in the bank now, with compound interest, to cover the debt when it is due. For more information, see Financial Functions.
PVLUMPSUM(rate,periods,amount)
| • | rate is the interest rate per period. |
| • | periods is the total number of periods. |
| • | amount is the payment made at the end of the last period. |
The result is returned to two decimal places.
Note: If you enter an obviously invalid parameter such as a negative interest rate, Analyzer returns an error.
Assuming an interest rate of 11% per annum compounded monthly, the present value of $10,000 due in three years is:
PVLUMPSUM(.11/12,3*12,10000) = 7,200.05