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You may also value from this link which walks through the true value of this concept: http://www.onemillionbucks.net/2008/10/time-value-of-money-not-40-year-old.html Source: Wikipedia The present value (PV) formula has four variables, each of which can be solved for: # PV is the value at time=0 # FV is the value at time=n # i is the rate at which the amount will be compounded each period # n is the number of periods (not necessarily an integer) :
The cumulative present value of future cash flows can be calculated by summing the contributions of FVt, the value of cash flow at time=t : Note that this series can be summed for a given value of n, or when n is .[2] This is a very general formula, which leads to several important special cases given below.
Wiki User
∙ 15y ago
Wiki User
∙ 11y agoThe present value is the amount of money that you would need to invest at the present at a given rate of return in order to earn a desired amount of money in the future.
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What is the present tense of compute?
the present tense of 'compute' will be 'computing'
How do you compute present and future value of a cash flow stream?
Future Value = Value (1 + t)^n Present Value = Future Value / (1+t)^-n
How do you compute the profitability index of a capital-budgeting proposal?
Dividing the present value of the annual after-tax cash flows by the cost of the project
Compute the current price of the bonds if the present yield to maturity is?
Compute the current price of the bond if percent yield to maturity is 7%
What is an adjective for compute?
It is computed, as in "the computed value".
What method of evaluating capital investment proposals uses the concept of present value to compute rate of return?
The method that uses the concept of present value to compute rate of return is called the Net Present Value (NPV) method. In this method, the cash inflows and outflows of a capital investment proposal are discounted to their present value using a discount rate. The NPV is then calculated by subtracting the initial investment from the present value of the cash flows. A positive NPV indicates a profitable investment, while a negative NPV suggests an unprofitable investment.
What is a capital investment's net present value?
Widely used approach for evaluating an investment project. Under the net present value method, the present value (PV) of all cash inflows from the project is compared against the initial investment (I). The net-present-valuewhich is the difference between the present value and the initial investment (i.e., NPV = PV - I ), determines whether the project is an acceptable investment. To compute the present value of cash inflows, a rate called the cost-of-capitalis used for discounting. Under the method, if the net present value is positive (NPV > 0 or PV > I ), the project should be accepted.
How old are you if you were born on 1924?
You can compute it by subtracting the birth_year against the current_year, the result is the present age. So, current_year - 1924 = present age.
If you were born in 1953 how old are you?
You can compute it by subtracting the birth_year against the current_year, the result is the present age. So, current_year - 1953 = present age.
Which methods of capital budgeting are the most frequently used?
The most frequently used methods of capital budgeting include net present value (NPV), internal rate of return (IRR), and payback period. NPV compares the present value of cash inflows to the present value of cash outflows over the project's lifespan, taking into account the time value of money. IRR calculates the rate of return that would result in a net present value of zero. Payback period measures the time required to recover the initial investment.
Write a java that computes the value of 2?
Compute means to calculate. What do you want to "compute", if you already know it is 2? If you want to show the value:System.out.println("Your number is " + 2);Compute means to calculate. What do you want to "compute", if you already know it is 2? If you want to show the value:System.out.println("Your number is " + 2);Compute means to calculate. What do you want to "compute", if you already know it is 2? If you want to show the value:System.out.println("Your number is " + 2);Compute means to calculate. What do you want to "compute", if you already know it is 2? If you want to show the value:System.out.println("Your number is " + 2);
How do you compute instantaneous value at given time of three phase alternator?
your mom nothing
