DEFINITION of 'Present Value Interest Factor  PVIF'
A factor that can be used to simplify the calculation for finding the present value of a series of values. PVIFs can be presented in the form of a table with PVIF values seperated by respective period and interest rate combinations.
The 'r' represents the discount interest rate, and the 't' represents the number of periods.
BREAKING DOWN 'Present Value Interest Factor  PVIF'
Using the PVIF works best when you are attempting to discount one value in the future. For example, assume you are going to receive $5,000 in four years time, with the current discount interest rate being 8%. Using the standard present value formula the calculation would be $5,000 / (1+.08)^{4 }.
This would result in a present value of approximately $3,675.15. By using a PVIF table, an individual can identify the factor for this calculation being 0.73503 (calculated: 1/(1.08^4)). They can then multiply the $5,000 by 0.73503, which results in $3675.15 as well. This is another way to come to the same answer as the standard present value formula, but becomes a useful technique when you are comparing or dealing with a large number of values.

Internal Rate Of Return  IRR
A metric used in capital budgeting measuring the profitability ... 
Net Present Value  NPV
The difference between the present values of cash inflows and ... 
Present Value Of An Annuity
The current value of a set of cash flows in the future, given ... 
Future Value Of An Annuity
The value of a group of payments at a specified date in the future. ... 
Present Value Interest Factor Of ...
A factor which can be used to calculate the present value of ... 
Discounted Cash Flow  DCF
A valuation method used to estimate the attractiveness of an ...

Fundamental Analysis
Discounted Cash Flow Analysis
Find out how analysts determine the fair value of a company with this stepbystep tutorial and learn how to evaluate an investment's attractiveness for yourself. 
Investing Basics
Calculating The Present And Future Value Of Annuities
At some point in your life, you may have had to make a series of fixed payments over a period of time  such as rent or car payments  or have received a series of payments over a period of time, ... 
Investing Basics
Understanding The Time Value Of Money
Find out why time really is money by learning to calculate present and future value. 
Fundamental Analysis
What Causes Inflation in the United States
Inflation is the main catalyst behind U.S monetary policy. But what causes this phenomenon of sustained rising prices? Read on to find out. 
Mutual Funds & ETFs
ETF Analysis: PowerShares FTSE RAFI US 1000
Find out about the PowerShares FTSE RAFI U.S. 1000 ETF, and explore detailed analysis of the fund that invests in undervalued stocks. 
Investing Basics
A Primer On Investing In The Tech Industry
The tech sector can provide fantastic returns for investors with a little knowhow in the field. 
Stock Analysis
Fortinet: A Great Play on Cybersecurity
Discover how a healthy product mix, largebusiness deal growth and the boom of the cybersecurity industry are all driving Fortinet profits. 
Stock Analysis
2 Catalysts Driving Intrexon to AllTime Highs
Examine some of the main reasons for Intrexon stock tripling in price between 2014 and 2015, and consider the company's future prospects. 
Investing Basics
Why do Debt to Equity Ratios Vary From Industry to Industry?
Obtain a better understanding of the debt/equity ratio, and learn why this fundamental financial metric varies significantly between industries. 
Fundamental Analysis
Is India the Next Emerging Markets Superstar?
With a shift towards manufacturing and services, India could be the next emerging market superstar. Here, we provide a detailed breakdown of its GDP.

What are the disadvantages of using net present value as an investment criterion?
While net present value (NPV) calculations are useful when you are valuing investment opportunities, the process is by no ... Read Full Answer >> 
What's the difference between net present value and internal rate of return? How ...
Both of these measurements are primarily used in capital budgeting, the process by which companies determine whether a new ... Read Full Answer >> 
Which is a better measure for capital budgeting, IRR or NPV?
In capital budgeting, there are a number of different approaches that can be used to evaluate any given project, and each ... Read Full Answer >> 
When does the fixed charge coverage ratio suggest that a company should stop borrowing ...
Since the fixed charge coverage ratio indicates the number of times a company is capable of making its fixed charge payments ... Read Full Answer >> 
What is the utility function and how is it calculated?
In economics, utility function is an important concept that measures preferences over a set of goods and services. Utility ... Read Full Answer >> 
How can a company execute a taxfree spinoff?
The two commonly used methods for doing a taxfree spinoff are either to distribute shares of the spinoff company to existing ... Read Full Answer >>