SESSION ONE

FORMULA SHEET
Formula Name:

Formula:

Future Value

Future Value= Present Value (1+i)t

Present Value

Present Value = C1
(1 + r)t

Discount Factor (DF)

Discount Factor =

OR

1
(1 + r)t
NPV=

Discounted Cash flow

PV Required Investment
C0 + C 1
1+ r

Net Present Value

Return

Discount Factor * C1

Return =

Profit
Investment

DCF=

C1 + C2 Ct:
(1+r)1 (1+r)2
(1+r)t

Perpetuity (Present Value of

Cash flows which is paid
through certain time)

Return = Cash Flow/Present value

r= C
PV
PV0 = Cash Flow/Discount Rate
PV0 = C1
r
Here, Discount Factor used,
PV0 = C1 * DF OR
C1 * 1
r
r
(1+r)t

Present Value of Annuity

PV = C *

Future Value of Annuity

FV = C *

Constant Growth Perpetuity

PV0 = C1
r-g

Perpetuity (Return)
Perpetuity (Present Value of
Cash flows)

1 r

1
r*(1+r)t

(1+r)t - 1
r