Abstract
Time value of money problems are integral to finance. We focus attention on the issues raised when a noninteger solution results from solving for the variable N (number of periods) in a time value of money annuity problem. We show that such a numerical solution, while mathematically correct, can deviate from the narrative of the problem. This deviation from the narrative could cause misunderstandings between instructors and their students and practitioners and their clients. We demonstrate how instructors and practitioners can explain the deviation from the narrative in such cases, and how cash flows can be adjusted to avoid missing goals.
Recommended Citation
(2026)
"Clarifying the Meaning of Noninteger N Values in Annuity Calculations,"
Journal of Economics and Finance Education: Vol. 17:
Iss.
1, Article 5.
Available at:
https://scholarship.rollins.edu/jefe/vol17/iss1/5
