Number of Periods Calculator
Definition – What is a Period?
In the concept of the time value of money, a period is an amount of time between either compounding periods or payments.
Each period represents a payment of an annuity (or perpetuity) and a time when the financial stream compounds.
Formula – How the Number of Payments are Calculated
This calculator does not use a specific formula to calculate the number of payments. It calculates them by using a test number to calculate a present value, then testing the result against the entered present value. Depending on the result, it tests another test number until it comes to a present value that is the same as the entered present value.
The upper bounds of the test number are 11,000 periods and the lower bounds are 0.001 periods.
Sources and External Resources
- Wikipedia – Time Value of Money – Wikipedia’s entry on the time value of money.