Thread: Financial Problem

Is there a way to distinguish between which formula to use for a financial problem that asks you to find the regular payment? The future value of an annuity or present value formula?

WHAT are you trying to calculate: a loan payment?

Compound interest formula is usually the best place to start



Where:

• A_t = Amount at time t
• A_0 = Inital amount
• x = annual interest rate
• n = compound period
• t = time

Originally Posted by Wilmer

WHAT are you trying to calculate: a loan payment?

so if i were calculating loan payments i should use the present value formula?

thanks guys for the quick responds

Originally Posted by Hellooo

so if i were calculating loan payments i should use the present value formula?

Noooooo...when calculating loan payments, use the "payments formula";
use the present value formula when calculating present values!