Present value of Money
- Discuss the concept of present value of money.
- How time value of money concept is used while making financial decisions.
- Julie wants to know how large of a deposit to make so that the money will grow to $10,000 in 5 years at a discount rate of 10%.
- Suppose you are trying to find the present value of two different cash flows. One is $100 two periods from now, the other a $100 flow three periods from now. Which of the following is/are true about the discount factors used to value the cash flows? Explain.