CFLib.org – Common Function Library Project

DiscountingInterest(p, r, t)

Last updated April 23, 2002

author

Stephan Scheele

Version: 1 | Requires: CF5 | Library: FinancialLib

Description:
Calculate the actual value of an amount by discounting the interest over n years.

Return Values:
Returns a numeric value.

Example:

<cfoutput>
$133.10 discounted at 10% over 1 year: #discountingInterest(0.1, 133.1, 1)#<br>
$133.10 discounted at 10% over 2 years: #discountingInterest(0.1, 133.1, 2)#<br>
$133.10 discounted at 10% over 3 years: #discountingInterest(0.1, 133.1, 3)#
</cfoutput>

Parameters:

Name Description Required
p Principal Yes
r Interest rate (0.03 = 3%) Yes
t Time in years. Yes

Full UDF Source:

/**
 * Calculate the actual value of an amount by discounting the interest over n years.
 * 
 * @param p 	 Principal 
 * @param r 	 Interest rate (0.03 = 3%) 
 * @param t 	 Time in years. 
 * @return Returns a numeric value. 
 * @author Stephan Scheele (stephan@stephan-t-scheele.de) 
 * @version 1.0, April 23, 2002 
 */
function DiscountingInterest(r, p, t){
 return (p / (1 + r)^t);
}
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