org.josef.finance

Class Finance

java.lang.Object

org.josef.finance.Finance

@Status(stage=DEVELOPMENT,
        unitTests=COMPLETE)
 @Review(by="Kees Schotanus",
        at="2009-10-10")
 @ThreadSafety(level=IMMUTABLE,
              doc="Utility class with only static methods")
public final class Finance
extends Object

Financial Calculations Utility class.

Version:

1.0 $Revision: 6298 $

Author:

Kees Schotanus$

Field Summary

Fields

Modifier and Type	Field and Description
static double	DECIMAL_INTEREST_RATE Constant to compute the decimal interest rate (perunage in Dutch) from a percentage.

Method Summary

Modifier and Type	Method and Description
static double	futureValue(double presentValue, double interest, int years) Computes the future value of a starting capital (present value) for which compound interest will be received annually.
static double	futureValue(double presentValue, double interest, int interestPaymentsPerPeriod, double periods) Computes the future value of a starting capital (present value) for which compound interest will be received interestPaymentsPerPeriod times per period for the duration of the supplied periods.
static double	presentValue(double futureValue, double interest, int years) Computes the present value of a future capital (future value) for which compound interest will be received annually.
static double	presentValue(double futureValue, double interest, int interestPaymentsPerPeriod, double periods) Computes the present value of a future capital (future value) for which compound interest will be received interestPaymentsPerPeriod times per period for the duration of the supplied periods.

Methods inherited from class java.lang.Object

clone, equals, finalize, getClass, hashCode, notify, notifyAll, toString, wait, wait, wait

Field Detail

DECIMAL_INTEREST_RATE

public static final double DECIMAL_INTEREST_RATE

Constant to compute the decimal interest rate (perunage in Dutch) from a percentage.
For example, when the interest rate is 5% then the decimal interest rate is: 5 / 100 => 0.05

See Also:

Constant Field Values

Method Detail

futureValue

public static double futureValue(double presentValue,
                                 double interest,
                                 int years)

Computes the future value of a starting capital (present value) for which compound interest will be received annually.
For example: A present value of $1000.- and an interest rate of 7% will result in a future value of $1007.- after one year. After ten years the future value is roughly twice the present value ($1967.15).
The mathematical formula for calculating the future value is:
fv = pv(1 + i / 100)^years
Where fv=Future Value, pv=Present Value and i=interest rate.

Parameters:

presentValue - The present value.

interest - The interest percentage per year.
Supply 5.0 for an interest rate of 5%.

years - The number of years.

Returns:

The future value.

futureValue

public static double futureValue(double presentValue,
                                 double interest,
                                 int interestPaymentsPerPeriod,
                                 double periods)

Computes the future value of a starting capital (present value) for which compound interest will be received interestPaymentsPerPeriod times per period for the duration of the supplied periods.
For example: What is the future value of a present value of $1000.- with a quarterly interest rate of 7%, after a year and a half?

   Financial.futureValue(1000.0D, 7.0D, 4, 1.5);
 

Which is approximately: $1109.70

The mathematical formula for calculating the future value is:
fv = pv(1 + i / 100 / n)^periods*n
Where fv=Future Value, pv=Present Value, i=interest rate and n=number of interest payments per period.

Parameters:

presentValue - The present value.

interest - The interest rate per period.
Supply 5.0 for an interest rate of 5%.

interestPaymentsPerPeriod - The number of times interest is payed per period.
Interest is always assumed to be payed at the end of the interest period. Note: In a period of a year the interest may be payed quarterly for example. This makes each interest period a quarter.

periods - The number of periods.

Returns:

The future value.

Throws:

IllegalArgumentException - When the supplied interestPaymentsPerPeriod is 0.

presentValue

public static double presentValue(double futureValue,
                                  double interest,
                                  int years)

Computes the present value of a future capital (future value) for which compound interest will be received annually.
For example: A value of $1007.-, one year in the future and an interest rate of 7% will result in a present value of $1000.-. Ten years in the future, the present value is roughly half the future value ($508.35).
The mathematical formula for calculating the present value is:
pv = fv / (1 + i / 100)^years
Where pv=Present Value, fv=Future Value and i=interest rate.

Parameters:

futureValue - The future value.

interest - The interest rate per year.
Supply 5.0 for an interest rate of 5%.

years - The number of years.

Returns:

The present value.

presentValue

public static double presentValue(double futureValue,
                                  double interest,
                                  int interestPaymentsPerPeriod,
                                  double periods)

Computes the present value of a future capital (future value) for which compound interest will be received interestPaymentsPerPeriod times per period for the duration of the supplied periods.
For example: What is the present value of a value of $1000.-, one year and a half in the future when the interest rate is 7%?

   Financial.presentValue(1000.0D, 7.0D, 4, 1.5);
 

Which is approximately: $901.14

The mathematical formula for calculating the present value is:
pv = fv / (1 + i / 100 / n)^periods*n
Where pv=Present Value, fv=Future Value, i=interest rate and n=number of interest payments per period.

Parameters:

futureValue - The future value.

interest - The interest percentage per period.
Supply 5.0 for an interest rate of 5%.

interestPaymentsPerPeriod - The number of times interest is payed per period.
Interest is always assumed to be payed at the end of the interest period. Note: In a period of a year the interest may be payed quarterly for example. This makes the interest period a quarter.

periods - The number of periods.

Returns:

The future value.

Throws:

IllegalArgumentException - When the supplied interestPaymentsPerPeriod is 0.