# Present Value (PV) of a growing perpetuity (Gordon Growth Model) calculator

### What is a Present Value (PV) of a Growing Perpetuity?

Present value (PV) of an annuity is a financial calculation used when determining the “today” value of a set of annuity payments that regularly grow and occur each compounding period that goes on forever.

### How is the Present Value of a Growing Perpetuity calculated?

The PV of a growing perpetuity is calculated through the Gordon Growth Model, a financial formula used with the time value of money.
$latex \text{Present Value} = \frac{\text{Payment Amount}}{\text{Interest Rate} – \text{Payment Growth Rate}}$

### What is the Payment Growth Amount?

The payment growth amount is the amount that the payment grows each compounding period.