## Present Value Factor

The formula for the present value factor is used to calculate the present value per amount that is received in the future.

The present value factor formula is based on the concept of time value of money. Time value of money is the idea that an amount received today is worth more than if the same amount was received at a future date. Any amount received today can be invested to earn additional monies.

## $$\frac{1}{[1+r{]}^{n}}$$

Here,r=rate of return,n=number of periods.

ENTER THE VARIABLES TO BE USED IN THE FORMULA