net present value
Date: 2011-11-26 23:13 tags: functional
The right tool for the job. Sometimes you find really nice applications of a language you already know - that you didn't think of when learning it. Like when I had to calculate "net present value" for a couple of investments. The code is pretty much what the formula looks like expressed mathematically.
--Calculate npv npv :: Float -> Float -> Float -> Float -> Float -> Integer -> Float npv initial rf b cashflow salvage years = (sumNpv (capm rf b) cashflow years) + (salvage / (capm rf b)^years) - initial -- Calculate the npv sum recursively sumNpv :: Float -> Float -> Integer -> Float sumNpv cap cashflow 0 = 0 sumNpv cap cashflow year = (cashflow / (cap^year)) + (sumNpv cap cashflow (year-1)) -- Calculate capm given risk free interest and beta capm :: Float -> Float -> Float capm rf b = ((rf + b * ( (erM rf b) - rf )) / 100)+1 erM :: Float -> Float -> Float erM rf b = rf + rf * b
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