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Annuity payment – future value
The annuity payment formula shown above is used to calculate the cash flows of an annuity when future value is known. An annuity is denoted as a series of periodic payments.
The annuity payment formula shown here is specifically used when the future value is known, as opposed to the annuity payment formula used when present value is known. There are not only mathematical differences between calculating an annuity when present value is known and when future value is known, but also differences in the real life application of the formulas.
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