WolframAlpha Assuming present and future value | Use or instead Calculate Future value: Interest rate: Interest periods: Also include: Powerful computation of the future value of moneyWolfram|Alpha can quickly and easily compute the future value of money in savings accounts or other investment instruments that accumulate interest over time. Plots are automatically generated to help you visualize the effects that different interest rates, interest periods or starting amounts could have on your future returns. Learn more about:
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Future value basicsThe future value formula is used to determine the value of a given asset or amount of cash in the future, allowing for different interest rates and periods.For example, this formula may be used to calculate how much money will be in a savings account at a given point in time given a specified interest rate. The effects of compound interest—with compounding periods ranging from daily to annually—may also be included in the formula. Plots are automatically generated to show at a glance how the future value of money could be affected by changes in interest rate, interest period or desired future value. What is Present Value?Present value is the current value of the future sum of money, at a specified rate of return. The future cash flows would be discounted. The higher the discount rate, the lower is the present value of the future cash flows. The lower the discount rate, the higher would be the present value of future cash flows. You must determine the appropriate discount rate for valuing future cash flows. The present value tells you if a sum of money today is worth more than the same amount in the future. The present value shows you that the money you receive in the future is not worth the money you receive today. How does the present value work? Say, you receive Rs 10,000 today. It is worth more than Rs 10,000 received four years later. It is because you get an opportunity to earn interest on the amount. It could be 4%-6% or more depending on where you invest the money. If you get Rs 10,000 after four years, you lose out on the rate of return. If you receive money today, you buy goods or avail services at today’s rates. Inflation that is the rise in the prices of goods and services makes things costly. In simple terms, inflation lowers the purchasing power of money. If you don’t invest money, inflation eats up its value. What is the Present Value Calculator?The present value calculator is a simulation that calculates the present value of a certain sum of money in the future. The present value is like compound interest in reverse. A present value calculator is a smart tool that helps you estimate the current amount needed to achieve a future financial goal. The present value calculator consists of a formula box, where you enter the future amount, interest rate per year, or discount rate, and the number of years. The calculator will display the present value of the investment. How does Present Value Calculators work?The present value calculator calculates the present-day value (PV) of an amount that you receive in the future. You must use the mathematical formula: PV = C / (1+r)^n PV = Present Value You have the concept of the time value of money, that shows you how money received today is worth more in the future. Let us suppose that you need Rs 1,00,000 precisely five years from today. You expect to earn 8% from an investment. The number of periods would be five. C = Rs 1,00,000 PV = 1,00,000 / (1+0.08)^5 PV = Rs 68,058. How to use the ClearTax Present Value Calculators?The ClearTax Present Value Calculator shows the present value of a fixed sum in the future. To use the ClearTax Present Value Calculator:
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FAQs on ClearTax Present Value Calculator
What is the future value of $1500 after 5 years if the annual interest rate is 6% compounded semiannually?The correct answer is d) $1,116.14.
What is the present value PV of $50000 received twenty years from now assuming the interest rate is 6% per year?What is the present value (PV) of $50,000 received twenty years from now, assuming the interest rate is 6% per year? C) Calculate the PV with FV = $50,000, interest = 6%, and N = 20, which = $15,590.24.
How do you calculate present value of an interest rate?The present value formula is PV = FV/(1 + i) n where PV = present value, FV = future value, i = decimalized interest rate, and n = number of periods. It answers questions like, How much would you pay today for $X at time y in the future, given an interest rate and a compounding period?
What is the present value of $100 received one year from now if the interest rate is 6 %?$100 today at 6% interest is worth $100 * 1.06 = $106 next year. The present value of an amount is what it is worth today.
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