The discount rate calculator takes future value (fv), present value (pv), inflation rate, cash flow (cf), starting from…, var rep, var time, var type, m, q, term or number of periods, sum and one way and returns final payout on…, flag r and rr. It is built for quick answers, for checking somebody else’s arithmetic, and for the moments when a formula book is not within reach.
What Is the Discount Rate Calculator?
The discount rate calculator takes future value (fv), present value (pv), inflation rate, cash flow (cf), starting from..., var rep, var time, var type, m, q, term or number of periods, sum and one way and turns them into final payout on..., flag r and rr.
It is the kind of calculation you would otherwise do on the back of an envelope: mechanical, repeatable and easy to get subtly wrong without noticing.
How the Discount Rate Figure Is Built
Each result is calculated from the ones before it, so the working is fully visible. That matters when the answer is going to be quoted to somebody else and you need to be able to explain where it came from.
The figures are exactly as good as the assumptions underneath them. Check the rates, the periods and the tax treatment before you rely on the result.
Reading the Result Sensibly
A small change in an input can move the result by much more than you would expect, particularly where the calculation divides by one of the figures you supplied. That is worth understanding before you rely on a figure.
For anything that will be committed to, write the inputs down beside the result. A number you can reproduce is worth far more than one you cannot explain.
A Worked Example
Working through an example, with future value (fv) set to 10, present value (pv) set to 5, inflation rate set to 2, the calculator returns rr of 241, and final payout on... of 20, and flag r of 1. Substitute your own figures and the same steps produce the same kind of answer.
Frequently Asked Questions
What do I need to work out final payout on...?
Enter future value (fv), present value (pv), inflation rate, cash flow (cf), starting from..., var rep, var time, var type, m, q, term or number of periods, sum and one way. The calculator then works through the relationship and reports final payout on..., flag r and rr.
What does the discount rate actually calculate?
It takes future value (fv), present value (pv), inflation rate, cash flow (cf), starting from..., var rep, var time, var type, m, q, term or number of periods, sum and one way and converts them into final payout on..., flag r and rr using the standard relationship for this problem. Each step is applied in turn, so every output is traceable back to the numbers you typed in.
How should I enter future value (fv)?
Use the value you actually have, in the unit shown next to the field. Enter every value in the same unit system. The calculator assumes the figures you supply are consistent, so it cannot correct a mistake that happens before the calculation starts.
Do I have to fill in every field?
Only the fields a particular result depends on. If you leave one blank, the results that need it simply show a note instead of a number, and everything else still works.
Does anything you type get stored?
No. The whole calculation runs inside your browser, and nothing you enter is uploaded, logged or sent anywhere.