Function InvestmentConstantNumberPeriods(PresentValue, FutureValue, Payment, InterestRate, Type)

InvestmentConstantNumberPeriods

The function InvestmentConstantNumberPeriods returns the number of periods for an investment based on periodic, constant payments and a constant interest rate.

InvestmentConstantNumberPeriods(
    PresentValue,            ! (input) numerical expression
    FutureValue,             ! (input) numerical expression
    Payment,                 ! (input) numerical expression
    InterestRate,            ! (input) numerical expression
    Type                     ! (input) numerical expression
    )

Arguments

PresentValue

The total amount that a series of future payments is worth at this moment. PresentValue must be a real number.

FutureValue

The cash balance you want to attain after the last payment is made. FutureValue must be a real number.

Payment

The value of the periodic payment for the investment. Payment must be a real number. Payment and InterestRate cannot both be \(0\).

InterestRate

The interest rate per period for the investment. InterestRate must be a numerical expression in the range \((-1, 1)\).

Type

Indicates when payments are due. \(Type = 0\): Payments are due at the end of each period. \(Type = 1\): Payments are due at the beginning of each period.

Return Value

The function InvestmentConstantNumberPeriods returns the number of periods for an investment based on periodic, constant payments and a constant interest rate.

Note

• The value returned may be fractional.

• The function InvestmentConstantNumberPeriods is similar to the Excel function NPER.

Example

InvestmentConstantNumberPeriods is used here to determine how long it takes to save up for an investment, or pay back on a loan, given a certain amount of money that can be reserved per period.

! How long does it take to save up 100
! when paying 10 each period and an interest rate of 4%?
_p_nperSavingUp :=
    InvestmentConstantNumberPeriods(
        PresentValue :  0,
        FutureValue  :  -100,
        Payment      :  10,
        InterestRate :  0.04,
        type         :  0);

! How long does it take to reimburse 100
! when paying 10 each period and an interest rate of 4%?
_p_nperReimbursing :=
    InvestmentConstantNumberPeriods(
        PresentValue :  -100,
        FutureValue  :  0,
        Payment      :  10,
        InterestRate :  0.04,
        type         :  0);
block where single_column_display := 1, listing_number_precision := 6 ;
    display { _p_nperSavingUp, _p_nperReimbursing};
endblock ;

The results in the listing file state that saving up requires less time than paying back.

_p_nperSavingUp     :=  8.578942 ;
_p_nperReimbursing  := 13.024384 ;

References

• General equations for investments with constant, periodic payments.