Return on Software: Maximizing the Return on Your Software Investment

Equal-Payment-Series Compound-Amount (F/A)

In some situations, instead of looking at a single payment, we want to know the future value of a series of equal payments. In other words, if we deposit or borrow a series of n equal payments at a given interest rate, how much will they be worth immediately after the last payment? This formula is used in situations such as retirement accounts where a series of equal payments are made over time, building up to a single final value.

It is important to remember that this formula, and all of the equal-payment-series formulas, uses the “end-of-period convention.” The end-of-period convention assumes that all equal-payment-series cash-flow instances happen at the end of the interest period and that the first ...