PAYMENT Function
Evaluates the periodic payment for an investment.
Usage
result = PAYMENT(rate, n_periods, present_value, future_value, when)
Input Parameters
rate—Interest rate.
n_periods—Total number of periods.
present_value—The current value of a stream of future payments, after discounting the payments using some interest rate.
future_value—The value, at some time in the future, of a current amount and a stream of payments.
when—Time in each period when the payment is made, either 0 for at the end of period or 1 for at the beginning of period.
Returned Value
result—The periodic payment for an investment. If no result can be computed, NaN is returned.
Input Keywords
Double—If present and nonzero, double precision is used.
Discussion
Function PAYMENT computes the periodic payment for an investment. It can be found by solving the following:
If rate = 0:
present_value + (payment)(n_periods) + future_value = 0
If rate ≠ 0:
Example
In this example, PAYMENT computes the periodic payment of a 25-year $100,000 loan with an annual interest rate of 8%. The payment is made at the end of each period.
PRINT, PAYMENT(0.08, 25, 100000., 0., 0)
; PV-WAVE prints: -9367.88
