{smcl} {* *! version 1 feb2013}{...} {cmd:help pvvar} {hline} {title:Title} {p2colset 8 20 21 2}{...} {p2col:{hi:pvvar} {hline 2}}Returns the present value of a series of payments (cash flows){p_end} {p2colreset}{...} {title:Syntax} {p 8 18 2} {cmd:pvvar} {it: varname1 varname2} [, {it:options} ] {synoptset 24 tabbed}{...} {synopthdr} {synoptline} {syntab:Options} {synopt:{cmd:due(#)}}When payments are due or made: 0 = end of period (default), or 1 = beginning of period {p_end} {synopt:{cmdab:gen:erate(}{it:string}{cmd:)}}Set the new variable's name. {p_end} {synoptline} {p2colreset}{...} {title:Description} {pstd} {cmd:pvvar} Returns the present value of a series of payments (based on a compounded interest rate). The cash flows must occur at regular intervals and match the corresponding periodic discount rate. {cmd:pvvar} generates a new variable containing the entire schedule of discounted cash flows. {dlgtab:Options} {phang} {opt due(#)} When payments are due or made: 0 = end of period (default), or 1 = beginning of period. {phang} {cmdab:gen:erate(}{it:string}{cmd:)} Set the middle part of new variable's name, default is {it:d}. The new {it:varname} is composed as follows: {it:varname1} + _d + value of due option. {title:Definitions} {cmd:pvvar} uses the following conventions: ¤ Periodic cash flows must be placed in {it:varname1}. ¤ Periodic discount rate must be placed in {it:varname2}. Enter as a decimal fraction (so should be greater than 0 and smaller than 1). {title:Input Arguments} The first entry in each {bf:varname} should be the initial period's value. {title:Example} Find the (end of period) present value of the following yearly cash flows. {cmd:. list year cash_flow disc_rate if year<=5, sep(0) noobs} {txt} {c TLC}{hline 28}{c TRC} {c |}{res} year cash_flow disc_rate {txt}{c |} {c LT}{hline 28}{c RT} {c |} 1 {c S|} 10,000 0.15{txt} {c |} {c |} 2 {c S|} 20,000 0.10{txt} {c |} {c |} 3 {c S|} 30,000 0.12{txt} {c |} {c |} 4 {c S|} 40,000 0.14{txt} {c |} {c |} 5 {c S|} 50,000 0.15{txt} {c |} {c BLC}{hline 28}{c BRC} {cmd:. pvvar cash_flow disc_rate} Present Value = {bf:95120.032} {it:Note}: New variable's name is {bf:cash_flow_d0} {title:Examples} {phang}{cmd:. pvvar var1 var2, due(1)}{p_end} {phang}{cmd:. pvvar var1 var2, due(1) gen(disc)}{p_end} {title:Saved results} {synoptset 15 tabbed}{...} {p2col 5 15 19 2: Scalars}{p_end} {synopt:{cmd:r(due)}}due value{p_end} {synopt:{cmd:r(PV)}}Present value of cash flows{p_end} {title:Author} Maximo Sangiacomo {hi:Email: {browse "mailto:msangia@hotmail.com":msangia@hotmail.com}}