com.webcab.ejb.finance.interest
Interface ValueOfAnnuityCertain

All Superinterfaces:

EJBObject, Remote

public interface ValueOfAnnuityCertain

extends EJBObject

This Enterprise JavaBean offers methods to calculate the accumulated and present values of annuity. Recall that an annuity is a series of periodic payments (or cash flows) of equal size.

Analysis of such cash flows is particularly useful when considering payments which could result from example from a US government Treasury bond.

Method Summary

double	accumulatedSeriesOfPayments(double interest, int noOfIntervals) Evaluates the accumulated value of a series of payments of one per interval payable in arrears over all intervals.
double	accumulatedSeriesOfPaymentsInAdvance(double interest, int noOfIntervals) Evaluates the accumulated value of a series of payments of one per interval payable in advance for all intervals.
double	continuousSeriesOfPaymentsAtEndOfInterval(double discountingRate, double ratio, double initialPayment) Evaluates the present value of a continuous annuity, that is, an infinite series of payments with each payment being made at the end of each interval.
double	paymentsOfOnePerInterval(double discountingRate, int noOfIntervals) Evaluates the present value of an annuity which consists of a series of payments of one per interval payable in arrears for all intervals.
double	paymentsOfOnePerIntervalInAdvance(double discountingRate, int noOfIntervals) Calculates the present value of an annuity which consists of a series of payments of one per interval payable in advance for all intervals.

Methods inherited from interface javax.ejb.EJBObject

getEJBHome, getHandle, getPrimaryKey, isIdentical, remove

Method Detail

accumulatedSeriesOfPayments

public double accumulatedSeriesOfPayments(double interest,
                                          int noOfIntervals)
                                   throws ValueOfAnnuityCertainDemoException,
                                          RemoteException

Evaluates the accumulated value of a series of payments of one per interval payable in arrears over all intervals.

Parameters:

interest - the fixed interest rate paid by the investment in decimal format (i.e. 1 percent = 0.01)

noOfIntervals - the number of intervals or equivalently the number of payments.

ValueOfAnnuityCertainDemoException

RemoteException

accumulatedSeriesOfPaymentsInAdvance

public double accumulatedSeriesOfPaymentsInAdvance(double interest,
                                                   int noOfIntervals)
                                            throws ValueOfAnnuityCertainDemoException,
                                                   RemoteException

Evaluates the accumulated value of a series of payments of one per interval payable in advance for all intervals.

Parameters:

interest - the fixed interest rate paid by the investment in decimal format (i.e. 1 percent = 0.01)

noOfIntervals - the number of intervals or equivalently the number of payments.

ValueOfAnnuityCertainDemoException

RemoteException

paymentsOfOnePerInterval

public double paymentsOfOnePerInterval(double discountingRate,
                                       int noOfIntervals)
                                throws ValueOfAnnuityCertainDemoException,
                                       RemoteException

Evaluates the present value of an annuity which consists of a series of payments of one per interval payable in arrears for all intervals.

Parameters:

discountingRate - the fixed rate expressed in decimal format (i.e. 1 percent = 0.01) at which the annuity payments are discounted over each interval. The discounting rate would in practice be equal to the rate of interest which could be obtained on a deposit during a given interval.

noOfIntervals - the number of intervals over which the annuity runs

ValueOfAnnuityCertainDemoException

RemoteException

paymentsOfOnePerIntervalInAdvance

public double paymentsOfOnePerIntervalInAdvance(double discountingRate,
                                                int noOfIntervals)
                                         throws ValueOfAnnuityCertainDemoException,
                                                RemoteException

Calculates the present value of an annuity which consists of a series of payments of one per interval payable in advance for all intervals.

Parameters:

discountingRate - the fixed rate expressed in decimal format (i.e. 1 percent = 0.01) at which the annuity payments are discounted over each interval. The discounting rate would in practice be equal to the rate of interest which could be obtained on a deposit during a given interval.

noOfIntervals - number of intervals over which the annuity runs

ValueOfAnnuityCertainDemoException

RemoteException

continuousSeriesOfPaymentsAtEndOfInterval

public double continuousSeriesOfPaymentsAtEndOfInterval(double discountingRate,
                                                        double ratio,
                                                        double initialPayment)
                                                 throws InterestException,
                                                        ValueOfAnnuityCertainDemoException,
                                                        RemoteException

Evaluates the present value of a continuous annuity, that is, an infinite series of payments with each payment being made at the end of each interval. After the initial payment is made all subsequent payments are a common ratio times the previous payment.

Parameters:

discountingRate - the fixed rate expressed in decimal format (i.e. 1 percent = 0.01) at which the annuity payments are discounted over each interval. The discounting rate would in practice be equal to the rate of interest which could be obtained on a deposit during a given interval.

initialPayment - the initial payment from the annuity

ratio - the common ratio which determining all future payments from the initial payment. This ratio is expressed as a percentage increase of each term over the preceeding one expressed in decimal format (i.e. 1 percent = 0.01)

InterestException

ValueOfAnnuityCertainDemoException

RemoteException