PVP Function

Returns the present value for a periodic cash flow stream (such as a bond), with repayment of principal at maturity.

Category:

Financial

Syntax

PVP(A,c,n,K,k₀,y)

specifies the par value.

Range:

A > 0

specifies the nominal per-year coupon rate, expressed as a fraction.

Range:

0 \leq c < 1

specifies the number of coupons per year.

Range:

n > 0

and is an integer

specifies the number of remaining coupons.

Range:

K > 0

and is an integer

specifies the time from the present date to the first coupon date, expressed in terms of the number of years.

Range:

0 < k_{0} \leq \frac{1}{n}

specifies the nominal per-year yield-to-maturity, expressed as a fraction.

Range:

y > 0

The PVP function is based on the relationship

\begin{matrix} P = Σ_{k = 1}^{K} \frac{c (k)}{{(1 + \frac{y}{n})}^{t_{k}}} \end{matrix}

The following relationships apply to the preceding equation:

data _null_;
p=pvp(1000,.01,4,14,.33/2,.10);
put p;
run;

The value that is returned is 743.168.