Calculate the time value of money method.

Calculate the time value of money method.

1- Table method(pv tables annuity) . these method used before financial calculators, calculators. And spreadsheets programs became commonly available, people calculated the time value of money by looking at financial tables.

2- Numerical Method : these method assumes the use of non-financial calculating the time value of money .Equations for calculating the present or future values of cash flows are given ,and you must enter the correct numbers in your calculator to arrive at a solution . 

related to the table method ,advances in technology have worn the need for using non- financial calculators.

Also when using the numerical method ,there are some calculations that cannot be computed using a regular calculator .however, the equations themselves are important because they clarify the foundation of time value of money calculations.

3- Financial Calculator Method

By these method you can use to calculate the time value of money ,that method has pre-programmed equations that compute the time value of money.

Buttons used to calculate the time value of money

- N: Represent the number of periods

-I   : Represent the interest rate for each period

-PV: Stands for present value, PMT stands for payment

-PMT: stands for payment.

-FV: Stands for present value

Not that PMT button used only with calculating annuities

4- Spreadsheet  method : that method computer program (like MS Excel) these program used to calculate time value of money.