In common terms the future value of an annuity or regular annuity is specified by the subsequent formula:
FVA_{n} = A (1 + k )^{n -1} + A (1 + k )^{n - 2} + ... + A ................................Eq(6)
A [((1 + k)^{n} - 1)/k]
Future value of an annuity due:
FVA_{n(due)} = A (1 + k )^{n }+ A (1 + k )^{n - 1} + ... + A(1 + k) ................................Eq(6)
....................................Eq(7)
= A [((1 + k)^{n} - 1)/k] (1 + k)
Here FVA_{n} = Future value of an annuity that has a duration of n periods
A = Constant periodic cash flow;
k = Interest rate per period;
n = duration of the annuity.
The term [((1 + k)^{n} - 1)/k] is considered to as the future value interest factor for an annuity (FVIFA_{k,n}). The value of its factor for some combinations of k and n are specified in the appendix at the end of this section.