Question.3424 - 1. What are the differences between simple interest and compound interest2. With regards to money: What are the differences between future value and present value?3. What considerations do you need to take when considering "time value of money"?4. Why is the following statement true? "A dollar today is worth more than a dollar tomorrow."
Answer Below:
Simple xxxxxxxx is xxxxxxxxxx only xx the xxxxx outstanding xxxxxx without xxxxxxxxxx for xxx interest xxxx increases xxxx time xxx formula xxx simple xxxxxxxx is x P x tI x times x times xx P x t xx which xxx is xxx principal xxx is xxx rate xxx ttt xx time xx contrast xxxxxxxx interest xxxxxxxx both xxxxxxxx on xxx outstanding xxxxxx and xxx interest xxxx the xxxxx It xx calculated x P xx ntA x frac x n xx A x nr xx where xxx is xxx number xx compounding xxxxxxx per xxxx Compound xxxxxxxx is xxxxxxx at x rapid xxxx an xxxxxx over xxxxxx interest xxxxxxx it xx based xx the xxxxxxxxxx interest xxxxxx making xx more xxxxxxx for xxxx -term xxxxxxxxxxx Bringham xx al xxxxxx value xx is xxx how xxxxx is xx an xxxxxxxxxx that xxx that xxxxxxxxxx will xxxxxxxx over x certain xxxxxx at x certain xxxxxxxx rate xxxxxxx Value xx constantly xxxxxxxx the xxxxxxx growth xx a xxxxxx amount xx money xxxxx is xxxx at x particular xxxx Future xxxxx take x look xx the xxxxxx growth xx money xxxxx present xxxxx takes xxxx consideration xxx flow xx cash xx its xxxxx as xx today xxxx et xx What xxxxxxxxxxxxxx do xxx need xx take xxxx considering xxxx value xx money xxxx considering xxx money xx a xxxx value xxxxx it xx important xx take xxxx account xxxxxxxxxx ineterst xxxxx and xxx motive xx opportunity xx invest xx spend xxx amount xxxxxxxxxx destroys xxx power xx purchase xxxxxxxxxxx and xxxx may xxxx to xxxxxxxx money xxxxxxx the xxxxxxxxx for xxxxxx than xxxx should xx The xxxxxxxxxxx that xxxx displays xx the xxxxxx benefits xxxxx are xxxx when xxxxxxxx one xxxxxxxxxx over xxx other xxxx et xx The xxxxxxxxx a xxxxxx is xxxxx more xxxx a xxxxxx tomorrow xx true xxx to xxxxx value xxxx A xxxxxx in xxxxxxx times xxx be xxxx to xxxx interest xx returns xxxxxxxxxx its xxxxxx value xxxxxxxxx a xxxxxx received xxxxxxxx loses xxx potential xxxx time xxx may xxx be xxxxxxxx because xx a xxxx or xxxxx economic xxxxxxx Bodie xx al xxxx the xxxxxx one xxx money xxx more xxxxxxxxxxxxx come xx grow xxxxxxxxxxxxxx J xxxxxxx P xxxxxxxxx finance xx ed xxxxxxx Bodie x Kane x Marcus x J xxxxxxxxxxx th xx McGraw-Hill xxxxxxxxx Brigham x F xxxxxxxx M x Financial xxxxxxxxxx Theory xxx practice xx ed xxxxxxx Learning xxxx S x Westerfield x Jordan x D xxxxxxxxxxxx of xxxxxxxxx finance xx ed xxxxxxxxxxx EducationMore Articles From Management
.ico)
.ico)
.ico)
.ico)
