Certificates of Deposit

A certificate of deposit (hereafter referred to as a CD) is a time deposit held in a bank or savings and loan for a fixed period of time at a fixed rate. Interest accrues on this deposit with a fixed periodicity (e.g. monthly or daily). The amount of money initially deposited in the CD is called the present value, and the final balance of the CD at the end of its term (which equals the initial deposit plus all accrued interest) is called the future value.

There are four basic variables involved in computing a CD: present value, interest rate, term, and future value. Given any of the three, you may find the fourth. Instead of creating four different modules to cover each possible CD calculation, a single response and request is used.

Sample Request

The following is a sample request for a CD calculation, where the future value is computed based upon present value, rate and term:

<inCD BasisDays="365" CalcType="getFutureValue" Compounding="monthly">
   <DepositDate>2005-10-27</DepositDate>
   <PresentValue>5000.00</PresentValue>
   <FutureValue></FutureValue>
   <IntRate>5.25</IntRate>
   <Term Units="months">12</Term>
</inCD>

Sample Response

The following is a sample response generated by the previous sample request:

<outCD>
   <CalcResult>Valid Calculation</CalcResult>
   <PresentValue>5000.00</PresentValue>
   <FutureValue>6165.57</FutureValue>
   <IntRate>5.250</IntRate>
   <Term Units="months">48</Term>
   <Maturity>2009-10-27</Maturity>
   <Gain>1165.57</Gain>
   <APY>5.374</APY>
</outCD>