Loan Payment Formula

A loan payment is required monthly payment for a loan. By definition, loan is the amount of money (or sometimes other goods) given to a borrower in exchange for consistent future payments, which usually consist of principal (original sum of borrowed money), interest and sometimes other additional Read More about Loan Payment Formula

Present Value Formula

Present Value (PV) formula refers to the exact numerical method to calculate present value of an asset or capital owned in future. The present value is often known as discounted value. Where PV = Present Value, CF is Cash Flow at period 1, r is the rate of interest or return, and n is the Read More about Present Value Formula

Simple Interest Formula

Simple Interest Formula is a mathematical method to calculate the interest paid or interest received at a certain rate against a specific amount of capital borrowed or deposit for a specified interval of time, as a result of a financial transaction. As we know, the amount of money would increase Read More about Simple Interest Formula

Return on Equity Formula

What Is Return on Equity? Return on Equity (ROE) is a financial measure of profitability which illustrates how effectively a company manages Shareholders’ Equity and gets profit from it. By using Return on Equity investors can see if they’re getting a good return on their investments, while a Read More about Return on Equity Formula

Equity Multiplier Formula

What Is Equity Multiplier? An Equity Multiplier is a measure of a company’s financial leverage computed by comparing Total Company’s Assets with Shareholders’ Equity. In other words, it’s the amount of company’s assets financed or owed by the shareholders. A financial leverage is a direct Read More about Equity Multiplier Formula

Inflation Rate Formula

What Is Inflation Rate? The Inflation Rate is a measurement of the rise of general price level over a period of time. It’s usually calculated for a year, quarter or month. That is to say the Inflation Rate is a decrease of a purchasing power of currency. The higher the Inflation Rate is, the Read More about Inflation Rate Formula

Perpetuity Formula

What Is Perpetuity? A Perpetuity is an endless consistent series of payments made at equal intervals of time. Said differently, a Perpetuity, or a perpetual annuity, is an infinite stream of cash flow payments.  How to Calculate the Present Value of Perpetuity? There are two basic Read More about Perpetuity Formula