Excel FV function

Function: FV

Description: Excel FV function (Future Value) in Microsoft Excel is used to calculate the future value of an investment, taking into account the amount of the investment, the interest rate, and the number of periods over which the investment is made. The future value represents the amount of money that an investment is expected to be worth at a future date, given a specified rate of return.

The syntax for the FV function is as follows:

Syntax: FV(rate, nper, pmt, [pv], [type])

Where:

• rate: The interest rate per period.
• nper: The total number of periods over which the investment is made.
• pmt: The periodic payment made each period. This value can be negative or positive, depending on whether the payment is an inflow or outflow of cash.
• [pv]: Optional. The present value, or the lump-sum amount that is being invested. If this value is not specified, it is assumed to be 0 (zero).
• [type]: Optional. A logical value that indicates when the payments are due. If this value is omitted or set to 0 (zero), payments are due at the end of the period. If this value is set to 1, payments are due at the beginning of the period.

Examples:

To calculate the future value of an investment of $1,000 that will receive annual payments of $100 for 10 years at an annual interest rate of 6%, you can use the following formula:

=FV(6%/1, 10, 100, 1000, 0)