## The power function, floor, and remainder

For our *FV=PV(1+R)^n*, we use a power function. The floor function would give the largest integer smaller than the current value. The remainder is the value that remains after an integer division. Given a positive discount rate, the present value of a future cash flow is always smaller than its corresponding future value.

The following formula specifies the relationship between a present value and its future value:

In this formula, *PV* is the present value, *FV* is the future value, *R* is the cost of capital (discount rate) per period, and *n* is the number of periods. Assume that we would receive $100 payment in two years and that the annual discount rate is 10 percent. What is the equivalent value today that we are willing to accept?

>>>100/(1+0.1)**282.64462809917354

Here, `**`

is used to perform a power function. The `%`

operator is used to calculate the remainder. Refer to the following example for the implementation of these operators:

**>>...**