Understanding PVA with constant and uneven cash flows
This page provides definition, example, calculation, and a calculator for PVA or Present Value of Annuities with constant and uneven cash flows. Don't waste time with MS Excel templates - we are sure, here you will find all you need!
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How do you define PVA?The present value of annuity is found as the sum of Present Values of individual cash flows of the stream Annuities with uneven cash flowsUsually we have annuities with constant stream of equal payment yet in good number of circumstances we are required to pay or deposit uneven amount of payments Formula for PVA with uneven cash flows?
Example of PVA with uneven cash flowsLet us examine finding Present Value of annuity or PVA with an example investment proposal. Let us say we were offered a series of cash inflows at the end of each of the next four years as $5000, $4000, $3000, and $1000. And the discount rate is 12%. PVA Calculation @ 12%
Annuities with constant cash flowsMost annuities require a series of periodic payment in same amount over a period of time. This is the most common type of annuity with constant cash flows. Formula for PVA with constant cash flows?
Example of PVA with constant cash flowsLet us examine finding Present Value of annuity or PVA with an example investment proposal. Let us say we were offered a series of cash inflows at the end of each of the next four years in the amount of $1000. And the discount rate or return is 10%. PVA Calculation @ 10%
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