Using FV(nper)

[mathteacher@highschool]

I'm wanting to get a future value, but can't find a complete explanation of
nper. I'm wanting to set up a 12 month future value but with bi-monthly
payments. Would this be accomplished by FV(rate = rate/12, nper = 26) I don't
want FV() to calculate 2 years and 2 months of interest. Thanks.

 

[JMB]

I think you are looking for:
FV(rate = rate/26, nper = 26)

where rate is expressed as an annual rate.

 

[joeu2004]

I'm wanting to get a future value, but can't find a complete explanation of
nper. I'm wanting to set up a 12 month future value but with bi-monthly
payments. Would this be accomplished by FV(rate = rate/12, nper = 26)
I don't want FV() to calculate 2 years and 2 months of interest.

I think you mean biweekly (every two weeks -- 26 periods in a year),
not bimonthly (every two months -- 6 periods in a year).

"nper" is simply the number of periods over which amortize the present
value. The nominal annual rate is divided by the number of periods
per year -- which may or may not be "nper".

For a biweekly period, the rate is divided by 26 because there are 26
such periods in a year. If you want to amortize over just a year,
then "nper" would also be 26. But you might want to amortize over 2
years with biweekly periods. In that case, "nper" would 52 (2*26).

 

[Bernard Liengme]

A quote from http://www.askoxford.com/asktheexperts/faq/aboutwords/bimonthly
Does bimonthly mean 'twice a month' or 'every two months'?
I'm afraid it means both! But in the publishing industry, it is used fairly
consistently to mean 'every two months'. The same ambiguity affects biweekly
and biyearly. If you want to be absolutely clear, use a phrase such as
'twice a week' or 'every two years'
best wishes

 

[joeu2004]

A quote from http://www.askoxford.com/asktheexperts/faq/aboutwords/bimonthly
Does bimonthly mean 'twice a month' or 'every two months'?
I'm afraid it means both! But in the publishing industry, it is used fairly
consistently to mean 'every two months'.

..... Which is what I said, I believe. That definition fails to
indicate who uses to mean "twice a month", and how prevalent that
(mis)usage is. Google "define: bimonthly" for some insight.

In any case, even "twice a month" does not match what the OP is
interested in, since "twice a month" would result in dividing the rate
by 24, not 26. So clearly, the OP did not mean "bimonthly", by any
definition.

The same ambiguity affects biweekly and biyearly.
If you want to be absolutely clear, use a phrase such as
'twice a week' or 'every two years'

Agreed.