Ordinary Annuity Formula

The formula for a deferred annuity based on an ordinary annuity where the annuity payment is made at the end of each period is calculated using ordinary annuity payment the effective rate of interest Effective Rate Of Interest Effective Interest Rate also called Annual Equivalent Rate is the actual rate of interest that a person pays or. The payment number is N the shows N as an exponent.

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Future value of an ordinary annuity the formula F P 1 IN 1I is calculated in which case P is the payout amount.

. I am equal to the interest rate discount. The future value of the annuity is shown in the letter F.

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