Javascript
function freq_rate(r) {
// Step 1 - Equivalent Effective Rate Per Frequency, m, of the Annual Rate, r
return ((1+r)^(1/12))-1;
}
function discount_freq_rate(r) {
// Step 2: The Discount Version of Step 1
return freq_rate(r)/(1+freq_rate(r));
}
function fv(r = 0.07,n = 30 ,m = 12) {
//Apply to a Case Where r = annual interest rate, m = # months and n = # years
return ((1 + freq_rate(r))^(m*n)-1)/discount_freq_rate(r);
}
I with fv(0.07,30), I am expecting a value of 1176.06485, but I am getting "Infinity" returned. Not sure what's wrong. My calculations are correct in excel with the following formula:
C9 = 1.07^(1/12)-1
C10 =C9/(1+C9)
1176.064858 =((1+C9)^(12*30)-1)/C10
because ^ in JS is not the "power" operator, try with this:
function freq_rate(r) {
// Step 1 - Equivalent Effective Rate Per Frequency, m, of the Annual Rate, r
return Math.pow(1+r , 1/12)-1;
}
That's because ^ in javaScript and other languages is a logical operator not a mathematical operator . See here->XOR
In javascript you can use Math.pow
function freq_rate(r) {
// Step 1 - Equivalent Effective Rate Per Frequency, m, of the Annual Rate, r
return Math.pow(1+r,1/12)-1;
}
function discount_freq_rate(r) {
// Step 2: The Discount Version of Step 1
return freq_rate(r)/(1+freq_rate(r));
}
function fv(r = 0.07,n = 30 ,m = 12) {
//Apply to a Case Where r = annual interest rate, m = # months and n = # years
return Math.pow(1 + freq_rate(r),(m*n)-1)/discount_freq_rate(r);
}
console.log( fv(0.07,30))