installment

Type

Financial Function

Purpose

The installment function calculates the periodic installment payment required for a financial transaction given the presentvalue, futurevalue, interest rate, and number of payment periods.

Syntax

installment( presentvalue, futurevalue, rate, periods)

Returns

A numeric value (the installment payment amount).

Usage

If the installment payment increases the value of the investment (e.g., an annuity), the numeric value returned by the function is expressed as a positive amount. If the payment decreases the value of the investment (e.g., loan amortization), the numeric value returned by the function is expressed as a negative amount. The interest rate, installment payments, and time periods must be based on the same terms. For example, if payments are made monthly on a five-year loan, the number of periods is (12 * 5) or 60. The interest rate must be expressed in the same terms (the monthly interest rate is the annual rate /12). When typing fractions like 10 / 12, DataEase requires that you type a space before and after the / division symbol.

Example 1

installment( 15000, 0, 10 / 12, 60 )

Returns:-318.71

This example calculates the monthly installment payment required to pay off a $15,000 loan in 5 years at an annual interest rate of 10%.

Example 2

installment( 0, 15000, 10 / 12, 60)

Returns:193.71

This example calculates the monthly installment amount required to accumulate $15,000 in 5 years at an annual interest rate of 10%.

Note: DataEase financial functions are derived from the formula shown below. (The double asterisks (meaning "raise to the power") cannot be used in a script).

 futurevalue = principal * ((1 + (rate/100))) ** periods) + (installment/(rate/100)) * (((1 + (rate/100)) ** periods) - 1)