1 / 5

Time Value of Money

Time Value of Money. Future Value of Money . The value of an investment after it has been compounded with interest for a specific period of time FV = principle (1 + interest) years FV of $5,000 in 5 years if interest is %5? FV = 5,000 (1.05) 5 FV = 5,000 (1.34) FV = $6,700.

imogene-dixon
Télécharger la présentation

Time Value of Money

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Time Value of Money

  2. Future Value of Money • The value of an investment after it has been compounded with interest for a specific period of time • FV = principle (1 + interest) years • FV of $5,000 in 5 years if interest is %5? • FV = 5,000 (1.05)5 • FV = 5,000 (1.34) • FV = $6,700

  3. Present Value of Money • The current value of an investment after it has been discounted • PV = Principle ( 1_____) • ( 1 + interest)years • PV of $10,000 if interest is %4 and time is 4 years • PV = 10,000 (_____1____) • (1 + .04 )4 • PV = 10,000 (.8219) = 8,219

More Related