Hi passcfaforsure, Below is the formula and the parameters definition. So look carefully.

1. PV is the value at time=0
2. FV is the value at time=n
3. i is the [discount rate](http://en.wikipedia.org/wiki/Discount_rate "Discount rate"), or the interest rate at which the amount will be compounded each period
4. n is the number of periods (not necessarily an integer)

As you can see from the above formula, from your eg. i = 10% in your case and n = 6months/12months = 0.5 in your case.

That is - if you assume 10% to be annual(12 months) => your compunding period is 12months => n = 6/12=0.5

I hope this clears your doubt.

Link used: http://en.wikipedia.org/wiki/Time_value_of_money