<p>Looking at the numbers again plan B is simply worse (assuming a non-negative interest rate). In <em>any</em> specific month you look at, you have to pay <em>no less</em> under plan B than under plan A.</p>

CC BY-SA 4.0
2022-01-05T07:13:58.817Z
2022-01-05T07:13:58.817Z
Giskard
<p>I have 2 options for a payment plan and need to calculate the total overall the best option.</p>
<p>Both plans are over a 20 years. The total payment amount is identical in both cases but the amounts at each stage very.</p>
<p>Im rusty on basic economics but if I remember correctly this is similar to a FV calculation</p>
<p>Plan A:
2000 month for 3 years = 72000
1500 month 3 years = 54000
1000 month for 11 years = 132000</p>
<p>Plan B
2500 month for 1 year = 30000
2000 month for 2 years = 48000
1500 month for for 40 months
1000 month for 10 years = 120000</p>
<p>I think that i need to do a FV calculation for each option and choose the smaller</p>
<p>Would appreciate an explanation and spreadsheet formula </p>

CC BY-SA 4.0
2022-01-04T23:33:20.153Z
This calculation is not possible without an interest rate also being given.
Giskard
CC BY-SA 4.0
2022-01-05T00:26:46.920Z
Assume 5% or any numbee
Avba
CC BY-SA 4.0
2022-01-05T07:15:58.113Z
I would be interested to learn which actual firms make these two offers.
Giskard
<microeconomics><mathematical-economics><finance>
How to compare 2 different payment schedules over 20 year period
Avba
# How to compare 2 different payment schedules over 20 year period

(Asked by: username_0 on 2022-01-04)

I have 2 options for a payment plan and need to calculate the total overall the best option.

Both plans are over a 20 years. The total payment amount is identical in both cases but the amounts at each stage very.

Im rusty on basic economics but if I remember correctly this is similar to a FV calculation

Plan A:
2000 month for 3 years = 72000
1500 month 3 years = 54000
1000 month for 11 years = 132000

Plan B
2500 month for 1 year = 30000
2000 month for 2 years = 48000
1500 month for for 40 months
1000 month for 10 years = 120000

I think that i need to do a FV calculation for each option and choose the smaller

Would appreciate an explanation and spreadsheet formula

**Tags:** microeconomics, mathematical-economics, finance

> **Comments:**
> **username_1**: This calculation is not possible without an interest rate also being given.  
> **username_0**: Assume 5% or any numbee  
> **username_1**: I would be interested to learn which actual firms make these two offers.  

---

## 1 answers

### Answer by username_1 on 2022-01-05. Score: 1

Looking at the numbers again plan B is simply worse (assuming a non-negative interest rate). In *any* specific month you look at, you have to pay *no less* under plan B than under plan A.


---

