17 Valuation Tables · 17.1 Valuation tables

17.1.2 Present value of Re 1 and present value of an annuity

The present value of Re 1 is the sum that must be invested today to grow to Re 1 after n years, 1/(1 + i)^n; the present value of Re 1 per annum is today's worth of a series of Re 1 payments, [1 − (1 + i)^−n]/i — which is the Years' Purchase.

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Key terms

  • present value of Re 1
  • discounting
  • 1/(1+i)^n
  • present value of Re 1 per annum
  • annuity
  • years' purchase
  • annuity Re 1 will purchase
  • i + s
  • loan instalment
  • deferment

What this note covers

  1. Core factsFoundation
  2. ExplainedStandard
  3. DeeperAdvanced
  4. Mains writingMains writing
  5. Common trapsFoundation
  6. Quick revisionFoundation

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