Annuity Present Value Calculator

It's a timing assumption with a real formula consequence, not just a label. Ordinary Annuity (the default) assumes each payment arrives at the END of its period; Annuity Due assumes it arrives at the BEGINNING. Because a beginning-of- period payment has one extra period to earn (or avoid paying) interest, Annuity Due multiplies both Present Value and Future Value by (1 + periodic rate) compared to an otherwise-identical Ordinary Annuity -- Annuity Due produces a strictly higher value than Ordinary Annuity at any rate above 0%; at exactly 0% the extra period earns no interest, so the two are identical.

Present Value discounts every future payment back to today, and a higher interest rate means each future dollar is worth less in today's terms -- the same $1,000 payment received 10 years from now is worth less today at an 8% discount rate than at a 3% one. This is the opposite direction from Future Value, which rises with a higher rate since it measures how much the payments grow WITH compounding rather than how much they're discounted.

Yes -- the total payment count (Number of Years multiplied directly by Payments per Year) is what drives the calculation internally, so switching from Annual (1 payment/year) to Monthly (12 payments/year) at the same 20-year term multiplies it from 20 to 240. Note the visible "Total Payments" output row is a dollar figure (payment count times Payment Amount, e.g. $240,000), not the raw count -- the count itself isn't displayed separately. Changing frequency also shrinks the periodic interest rate correspondingly (Annual Rate divided by Payments per Year), since each of the many more periods compounds at a proportionally smaller rate.

Yes -- Present Value is Payment Amount multiplied by the PV Factor, so doubling Payment Amount exactly doubles Present Value (and Future Value), holding the interest rate, term, frequency, and payment timing constant. PV Factor itself depends only on the rate, term, frequency, and payment timing -- never on the payment amount -- which is exactly what makes this direct proportionality hold.