PMT

PMT

How to Use the Power BI DAX function PMT

Syntax of the PMT Function

The PMT function in Power BI has the following syntax:


PMT(rate, nper, pv, [fv], [type])


– `rate`: The interest rate of the loan.

– `nper`: The total number of periods for the loan.

– `pv`: The present value of the loan.

– `[fv]` (optional): The future value of the loan. If omitted, the value is assumed to be 0.

– `[type]` (optional): A value of 0 or 1 that indicates when payments are due. If omitted, the value is assumed to be 0.

Examples of PMT Function

Let’s take a look at some examples of using the PMT function.

Example 1: Calculate the Loan Payment

Suppose you want to borrow $100,000 for a period of 10 years at an annual interest rate of 5%. To calculate the monthly payment for this loan, you can use the following formula:


=PMT(5%/12, 10*12, -100000)


This will return the value of $1,061.69, which is the monthly payment you need to make.

Example 2: Calculate the Loan Payment with Additional Parameters

Suppose you want to borrow $100,000 for a period of 10 years at an annual interest rate of 5%, but with a future value of $50,000. To calculate the monthly payment for this loan, you can use the following formula:


=PMT(5%/12, 10*12, -100000, 50000)


This will return the value of $716.14, which is the monthly payment you need to make.

Tips for Using PMT Function

Here are some tips for using the PMT function effectively:

1. Always use consistent units for the `rate`, `nper`, `pv`, and `fv` parameters.

2. Make sure the values you input for the `rate` and `nper` parameters are correct and correspond to the loan you are calculating.

3. If you are not sure about the value of the `type` parameter, use the default value of 0.

4. Remember to include the negative sign for the `pv` parameter, as this represents the amount you are borrowing.

5. Always double-check your calculations to ensure accuracy.

In summary, the Power BI DAX function PMT is a useful tool for calculating loan payments. By understanding its syntax and following some tips for its usage, you can easily calculate the payment for any loan.

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