DATABASE FUNDAMENTALS
WORKBOOK THEMES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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PV(rate, nper, pmt, fv, type)
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PVAL(rate, nper, pmt, fv, type)
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PV(rate, nper, pmt, term)
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PVAL(rate, nper, pmt, term)
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Detailed explanation-1: -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?
Detailed explanation-2: -Rate is the interest rate for the loan. Nper is the total number of payments for the loan. Pv is the present value, or the total amount that a series of future payments is worth now; also known as the principal. Fv is the future value, or a cash balance you want to attain after the last payment is made.
Detailed explanation-3: -Pmt is the fixed payment made each period, fv is the amount the annuity will be worth (default is 0) and guess is the estimate of the interest rate (default is 10%). Type indicates when the payments are due: 0 refers to payments due at the end of the period and 1 at the beginning.
Detailed explanation-4: -"PMT” stands for “payment", hence the function’s name. For example, if you are applying for a two-year car loan with an annual interest rate of 7% and the loan amount of $30, 000, a PMT formula can tell you what your monthly payments will be.