When do you use fvif and fvifa?

Answer 1

An Annuity is a series of payments of a fixed amount for a specified number of equal length periods When the FV of an annuity is known, and you need to calculate the value of each payment, or the FVIFA, then: FVIFA = Future Value Interest Factor Annuity

FVIFA = ((1 + r)t -1)/r FVA = Future Value of an Annuity

FVA = PMT x (FVIFA r, t) * where:

PMT = Regular payments

r = discount rate - (interest rate of your choosing)

t = number of periods (time) of annuity - (number of years for example) When the PV of an annuity is already known, and you need to calculate the value of each payment, or the PVIFA, then: PVIFA = Present Value Interest Factor Annuity

PVIFA = ((1/r) - 1/r(1+r)t ) PVA = Present Value of an Annuity

PVA = PMT x (PVIFA r, t) * where:

PMT = Regular payments

r = discount rate - (interest rate of your choosing)

t = number of periods (time) of annuity - (number of years for example)