I'm trying to learn the financial functions and i don't get how the calculate this function in the help section, please help. This is the function example;
So you're just learning this for fun? This function gives you the net present value. For this example, it's asking what the NPV is if you paid 2500 on 2008-01-01 and received 2750 on 2008-09-01at a 10% interest rate. Essentially you are taking the PV of $2,750 on 09/01/2008 and subtracting 2,500 to get the NPV. The formula for PV = FV / (1 + r)^Y. FV = 2,750; r = .1; Y = 2/3 (8 months out of 12). Therefore PV is approx. $2,580. Subtract 2,500 and bob's your uncle.
