# Present Value Calculator

Present Value Calculator

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## What is Present Value?

Present Value is a concept used in finance to calculate the current value of a future sum of money. It takes into account the time value of money, which states that a dollar today is worth more than a dollar in the future due to the potential for earning interest. Present Value is calculated by discounting the future sum of money at a certain rate of interest.

## What is Present Value Calculator?

A Present Value Calculator is a tool used to calculate the current value of a future sum of money or stream of cash flows given a specified rate of return. It is used to determine the present value of an investment, loan, or annuity. The present value calculator takes into account the time value of money, which states that a dollar today is worth more than a dollar in the future due to its potential earning capacity.

## How to Calculate Present Value?

Present Value (PV) is the current value of a future sum of money or stream of cash flows given a specified rate of return. To calculate the present value, you need to know the future value, the rate of return, and the number of periods. The formula for calculating present value is: PV = FV / (1 + r)^n Where: PV = Present Value FV = Future Value r = Rate of Return n = Number of Periods

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