Present Value Of Perpetuity Formula

The PV of perpetuity formula shows the present value of an infinite stream of identical cash flows made at regular intervals over time. Given here the present value of perpetuity formula to calculate the present value of perpetuity using the current payments and the interest rate for those payments. Perpetuity is a type of annuity that receives an infinite amount of periodic payments. It is obtained by dividing the fixed periodic payment by the interest rate per compounding period.

PV of Perpetuity Formula


Present Value of Perpetuity = Periodic Payments / (Interest Rate / 100)

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PV of Perpetuity is an annuity type that gets the infinite number of periodic payments. The present value of perpetuity formula can also be used to determine the interest rate charged, and the size of the regular payment.

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