Search results “What is the time value of money mean”

Time value of money is explained in hindi. Let's understand Power of Compounding, Present Value and Future value concepts. We will also learn about Simple Interest and Compound Interest & how they work in investing in the upcoming videos.
Related Videos:
Future Value - https://youtu.be/BFRGWenwulc
Future Value of an Annuity - https://youtu.be/f6a7E3326QQ
Future Value of Uneven Cash Flows - https://youtu.be/yHoTUk8HP-c
Present Value - https://youtu.be/pxm-5MBO2dg
Present Value of an Annuity - https://youtu.be/0giLqLyijtc
Net Present Value (NPV) - https://youtu.be/SpHIBfPGwx8
Internal Rate of Return (IRR) - https://youtu.be/x6eXfx2Tv-w
Rule of 72: https://youtu.be/BFRGWenwulc
इस वीडियो में समय और पैसे के मूल्य को हिंदी में समझिये। चलिए कम्पाउंडिंग, प्रेजेंट वैल्यू और फ्यूचर वैल्यू के कॉन्सेप्ट्स की पावर को समझते हैं। आने वाले विडोज़ में हम सिंपल इंटरेस्ट और कंपाउंड इंटरेस्ट के बारे में समझेंगे और साथ ही जानेंगे की ये इंवेस्टमेंट्स में कैसे काम आते हैं।
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In this video, we have explained:
What is time value of money?
How to calculate the time value of money?
What is the concept of time value of money?
How important is time value of money in financial management?
What is the best method for the time value of money calculation?
How to calculate the present value and future value of an investment?
How you can calculate the present value of annuity and future value of annuity?
What is the formula for calculating the present value and future value?
How simple interest and compound interest calculation works with investments?
How to know time value of money for long-term investments?
How to calculate the value of future investments?
How calculating the time value of money works for stock market investments?
How to calculate the future value using compound interest formula?
Make sure to Like and Share this video.
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Hope you liked this video in Hindi on “Time Value of Money”.

Views: 28898
Asset Yogi

Why when you get your money matters as much as how much money. Present and future value also discussed. Created by Sal Khan.
Watch the next lesson:
https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial/present-value/v/introduction-to-present-value?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets
Missed the previous lesson? Watch here: https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial/cont-comp-int-and-e/v/continuously-compounding-interest-formula-e?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets
Finance and capital markets on Khan Academy: If you gladly pay for a hamburger on Tuesday for a hamburger today, is it equivalent to paying for it today? A reasonable argument can be made that most everything in finance really boils down to "present value". So pay attention to this tutorial.
About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We've also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content.
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Views: 423517
Khan Academy

Time Value of Money - Financial Management (FM)
Time Value of Money - TVM
The time value of money means money available at the present time is worth more than the same amount in the future due to its potential earning capacity.
Basic Time Value of Money
FV = Future value of money
PV = Present value of money
i = interest rate
n = number of compounding periods per year
t = number of years
Based on these variables, the formula for TVM is:
FV = PV x (1 + (i / n)) ^ (n x t)
Few of the basic terms used in time value of money calculations are:
Present Value
When a future payment or series of payments are discounted at the given rate of interest up to the present date to reflect the time value of money, the resulting value is called present value.
Future Value
Future value is amount that is obtained by enhancing the value of a present payment or a series of payments at the given rate of interest to reflect the time value of money.
Interest
Interest is charge against use of money paid by the borrower to the lender in addition to the actual money lent.
Application of Time Value of Money Principle
There are many applications of time value of money principle. For example, we can use it to compare the worth of cash flows occurring at different times in future, to find the present worth of a series of payments to be received periodically in future, to find the required amount of current investment that must be made at a given interest rate to generate a required future cash flow, etc.
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StayLearning

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Exactly what is Present Value and how will you utilize the Present Value Formula? In the event that you already understand the idea of Future Value, you will be able to easily understand Present Value.
Exactly what is the "Present Value" of today's $100? It's also $100! Why? Because "present" means "today". Thus, it is $100 today (present value), and after earning interest, it may become $105 the following year (future value).
Let's say that one year ago, this money was only a little more than $95, and then it earned interest all through the year, and now it's valued at$100. Exactly which is the "Past Value" of your $100? Again, very straightforward! It is $95.
So... with regard to your $100 right now, Present Value is $100, Past Value is $95, and the Future Value is $105. However, that was quite a simple example to point out the concept.
The important challenge in school as well as actual business is learning the specific number of your Future Value, Present Value, and Past Value, using scary looking but very simple formulas.
The Present Value or Past Value Formula, simplified, resembles this:
Present Value or Past Value = (1 interest rate)^n
Where n = number of years.
Don't be alarmed. You might prefer to watch it in action in the video above and you'll see how easy it is to use it.
Just about the most confusing thing regarding the Present Value and Past Value concepts is that in many different business schools also with numerous books, Present Value and Past Value are explained almost like they're exactly the same thing. However, they are not. They are very different! Why the confusion?
Because they definitely utilize the same formula. However, the result of the formula will allow you compute either the present value or the past value, depending on how the story is told.
http://www.youtube.com/watch?v=zR3L5mLTi7s

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MBAbullshitDotCom

This Course of Financial Management is meant for the students of Delhi University pursuing B. Com either Regular or Correspondence. The course is taught by M. S. Juneja

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Juneja Institute

A choice between money now and money later. Created by Sal Khan.
Watch the next lesson:
https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial/present-value/v/present-value-2?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets
Missed the previous lesson? Watch here: https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial/present-value/v/time-value-of-money?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets
Finance and capital markets on Khan Academy: If you gladly pay for a hamburger on Tuesday for a hamburger today, is it equivalent to paying for it today? A reasonable argument can be made that most everything in finance really boils down to "present value". So pay attention to this tutorial.
About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We've also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content.
For free. For everyone. Forever. #YouCanLearnAnything
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Subscribe to Khan Academy: https://www.youtube.com/subscription_center?add_user=khanacademy

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Khan Academy

This video explains the concept of the time value of money, as it pertains to finance and accounting. An example is given to illustrate why there is a time value associated with the timing of cash flows.
Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com
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Edspira

Present Value of an Annuity excel formula, calculation and concept explained in hindi with examples. How to calculate Present value of annuity in Excel and manually? Eg. you can calculate Present Value of monthly Rent that you get from a lease.
Related Videos:
Time Value of Money - https://youtu.be/Pazp1b2LhAQ
Present Value - https://youtu.be/pxm-5MBO2dg
Future Value - https://youtu.be/BFRGWenwulc
Future Value of an Annuity - https://youtu.be/f6a7E3326QQ
Future Value of Uneven Cash Flows - https://youtu.be/yHoTUk8HP-c
Net Present Value (NPV) - https://youtu.be/SpHIBfPGwx8
Internal Rate of Return (IRR) - https://youtu.be/x6eXfx2Tv-w
इस हिंदी वीडियो में प्रेज़ेंट वैल्यू ऑफ़ एन्युटी को उदहारण के साथ समझाया गया है।
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In this video, we have explained:
What is the present value of an annuity?
How to calculate the present value with an annuity?
What is the concept of present value of an annuity?
What are the basics of the time value of money?
How to calculate the present value of an annuity in Microsoft Excel or Google spreadsheet?
What is the calculation formula of the present value of an annuity?
What is the meaning of the present value of an annuity?
How to calculate the present value of a rental income?
How present value of companies are calculated?
How to calculate the present value of annuity for any fixed income?
Make sure to Like and Share this video.
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Hope you liked this video in Hindi on “Present Value of an Annuity”.

Views: 9662
Asset Yogi

The time value of money (TVM) is the idea that money available at the present time is worth more than the same amount in the future due to its potential earning capacity or in other words we can say that money available at the present is worth more than the same amount in the future due to financial factors like inflation.
Case I: Savings Bank Account
P = INR 1,00,000
R = 3.5% yearly
T = 1 Year
Amount after 1 year = PRT/100 = INR 1,03,500
means interest earned = INR 3500 only in 1 year.
Case II: Fixed Deposit (FD) in Bank Account
P = INR 1,00,000
R = 7.5% yearly
T = 1 Year
Amount after 1 year = PRT/100 = INR 1,07,500
means interest earned = INR 7500 only in 1 year.
Case III: Invested in business/micro lending
P = INR 1,00,000
R = 15.0% yearly
T = 1 Year
Amount after 1 year = PRT/100 = INR 1,15,000
means interest earned = INR 15000 in 1 year.
If inflation is @ 5% to 8% then, imagine ROI on bank FD and Savings Bank Account.

Views: 2993
ABHISHEKSINGH.IN

The Time Value of Money
Perhaps you’ve heard this term before but are not quite sure what it means or how it actually applies in the real world. Through my site I was asked to give my thoughts on a particular situation that I wanted to share as it gives a great case study in understanding and applying the concept of considering money and it’s value relative to time.
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ClayTrader

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b) Time Value of Money
c) Financial Analysis through Ratios (covering ratios for performance evaluation and financial health, application of ratio analysis in decision making).
d) Financial Analysis through Cash Flow Statement
e) Financial Analysis through Fund Flow Statement
f) Cost of Capital of Business (Weighted Average Cost of Capital and Marginal Cost of Capital)
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CARAJACLASSES

This video shows how to calculate the payments of a mortgage loan.

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Ph.D. in Finance

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The time value of money (TVM) is the concept that money available at the present time is worth more than the identical sum in the future due to its potential earning capacity.
1 What is the formula for time value of money
2 What is the time value of money and why is it important
3 What do you mean by value for money
4 How does money affect the time value of money
5 Time value of money example
6 Time value of money formula
7 Time value of money in financial management
8 Reasons for time value of money
9 Importance of time value of money
10 Time value of money real life examples
11 Time value of money calculation
12 Time value of money calculator
For Full Course Contact us @ 9717356614 or Visit our site www.cdclasses.com

Views: 7045
CMA. Chander Dureja

Time value of money is the core principal around finance. It states that a dollar today is worth more than a dollar in the future. Why is this true? One example is that you can invest that dollar today and it will be worth more in a year. Another more human example is that we'd like to have a new car today rather than waiting a year to get the same car. If you don't have the money you will have to pay someone more money for a loan so that you can have that money today versus saving your own money and waiting.
The formulas are quite simple:
PV = FV(1+r)^n
FV = PV/(1+r)^n
NOTE: If you are using a quarterly rate you need to multiple the "n" by the number of periods. For example, if you have a 4% annual rate that compounds quarterly you would use the following:
PV = FV(1 + .01)^4

Views: 230
Dimitri Bianco

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Grooming Education Academy by Chandan Poddar

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The time value of money, commonly abbreviated as simply TVM, is the idea that money loses value over time. You may have heard the saying one dollar received today is worth more than one dollar received tomorrow. What this attempts to explain is the fact that the value of your hard earned money decreases each and every day.
As an example, lets say that that your friend asked you for $500 with the promise to repay you that same amount in twelve months. Although you may be inclined to help your friend out this wouldn't be a great financial decision. But why? You're still receiving that same $500 you loaned him or her twelve months ago. The truth is, that although the numerical value of your $500 remains unchanged, you incur several costs by not having it in your possession.
The first and probably the most obvious cost that you incur is inflation. Inflation is the increase in the price of goods and services over a period of time. Inflation generally runs at about two percent annually, although it has been quite less as of late. So if you hold your money for that period of time, what you can do with that money actually decreases.
The financial equation to determine a present value is as follows: PV equals FV divided by one plus i to the nth power. In this equation, PV is the present value of our money and what we are trying to determine. FV represents that future value of our money, which is $500 . i represents the interest rate that we intend to discount or reduce our $500 by. Generally for discounting purposes the interest rate represents what we could've received if you had the money in our possession and put it to good use. In this case, we are going to discount our money by an inflation rate of two percent to reflect its diminished value. The last bit of data we need is the number of periods or n, which will be one to reflect the number of years we are going to discount our $500 by.
The second reason that money decreases in value over time is due to opportunity costs. An opportunity cost represents what you give up by loaning the $500 to your friend. More specifically, the opportunity cost represents the next best alternative. What that is depends upon your unique situation. It could be investing in the stock market, placing the money in a savings account, or even spending it on new clothes. Unfortunately you incur an opportunity cost by giving up possession of your money.
Now as a result of both inflationary pressures and opportunity costs your $500 will be worth less in twelve months. This is why banks charge interest on loans and why consumers expect to earn some type of interest when they place their money in a bank. It's simply being compensated for the costs that they incur by not having the money in their possession at this moment in time.

Views: 6664
Alanis Business Academy

Thanks to all of you who support me on Patreon. You da real mvps! $1 per month helps!! :) https://www.patreon.com/patrickjmt !! Annuities : Annuity Due , Finding Future Value. In this video, we invest a fixed amount at regular intervals in an annuity due. We then find the future value of the annuity.

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patrickJMT

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OneClass

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Exactly what is Present Value and how will you utilize the Present Value Formula? In the event that you already understand the idea of Future Value, you will be able to easily understand Present Value.
Exactly what is the "Present Value" of today's $100? It's also $100! Why? Because "present" means "today". Thus, it is $100 today (present value), and after earning interest, it may become $105 the following year (future value).
Let's say that one year ago, this money was only a little more than $95, and then it earned interest all through the year, and now it's valued at$100. Exactly which is the "Past Value" of your $100? Again, very straightforward! It is $95.
So... with regard to your $100 right now, Present Value is $100, Past Value is $95, and the Future Value is $105. However, that was quite a simple example to point out the concept.
The important challenge in school as well as actual business is learning the specific number of your Future Value, Present Value, and Past Value, using scary looking but very simple formulas.
The Present Value or Past Value Formula, simplified, resembles this:
Present Value or Past Value = (1 interest rate)^n
Where n = number of years.
Don't be alarmed. You might prefer to watch it in action in the video above and you'll see how easy it is to use it.
Just about the most confusing thing regarding the Present Value and Past Value concepts is that in many different business schools also with numerous books, Present Value and Past Value are explained almost like they're exactly the same thing. However, they are not. They are very different! Why the confusion?
Because they definitely utilize the same formula. However, the result of the formula will allow you compute either the present value or the past value, depending on how the story is told.
http://www.youtube.com/watch?v=FnzoTQMCIo4

Views: 111504
MBAbullshitDotCom

Background
A dollar received now is more valuable than a dollar received a year from now. If you have that dollar today, you can invest it and increase its value. Let's explain a bit further:
The time of value of money is the difference in value between having a dollar in hand today and receiving a dollar sometime in the future.
Why is present and future value important?
Since money has a time value, we must take this time value into consideration when making business decisions. Present and future value calculations are powerful methods available in making financial decisions.
Once you understand and master the calculations, you can apply these equations for restating cash flows to make them equivalent in business decisions. The calculations are building blocks for many decisions facing individuals and managers alike. In addition, these calculations allow one to calculate returns on investments, capital budgeting, and return on annuities, just to name a few.
Key terms:
Future value (fv) and present value (pv) are two concepts in clarifying the value of money.
Future value is explained as an amount of money invested at present and will mature at the end of a given time when compounded at a given interest rate.
Present value is money that must be invested now to accrue to a certain amount of money in the future when compounded. In simpler terms, present value is the value today of an amount of money in the future. Why is this important? For these situations, businesses need to find a method of weighing cash flows that are received at various periods of times (annual, years, quarters, ect).
How do we go about finding the present and future value of cash flow?
There are two fundamental equations that are commonly used; this video will demonstrate them throughout the presentation.
Objectives:
Following my discussion, you will be able to:
• Have the knowledge of present value (pv) and future value (fv)
• Be able to calculate the pv and fv with compounding
• Have an understanding of compound interest
Discussion:
The video discusses the value of a dollar in hand today and applying calculations to determine what that dollar will be worth in the future. In addition, the video demonstrates the concept of wanting to have a specified amount of money in the future and the amount of money needed today in order to earn that specified amount.
See the formulas used in video:
Fv=pv (1+i) n
Pv= (1/1+i) n
FvPvn
Pv=the beginning amount
i= the interest rate/year
n=number of years
Fv=value at the end of n years.
Important points:
When computing compounding interest for greater than one year, remember that the interest in the next year is being paid on interest. The interest on the original dollar amount is referred to as "simple interest." Lastly, Net present value can be defined as the difference between the PV of cash inflows and the present value of cash outflows. Net present value is used in capital budgets to assess the probability of a project. The net present value is a standard affirming that a project should be established.
Example:
If a bank pays 5% interest on a $100 deposit today, in one year, this $100 will be worth $105. This is expressed by the following equation: F1= p (1+r). F1 is the balance at the end of the period, p represents the amount of invested, and r represents the rate of interest.
For example, the future of $1,000 compounded at 10%, would be $1,100 after one year and $ 1,331 after three years of investing. For example, if the interest rate is 10%, then the present value of $500 earned or spent in one year from now is $500 divided by 1.10, equates to $455. This example demonstrates the overall notion that the present value of a future amount is less than the actual future amount.
Summary
Present and future values are important methods for any financial decision. An investment can be viewed in two methods. We discussed present and future values in this video. The process of finding the present value of future cash flows is referred as discounting. Discounting future value to present value is a common technique, especially when weighing in on capital budget decisions. Have the knowledge of the calculations will allow individuals to calculate almost any investment decision

Views: 103724
Lisa Dumont

Net Present Value or NPV concept & calculation method in Excel explained in Hindi. NPV is an important valuation metric to evaluate a project, business, franchise or an investment opportunity. It is also used in Discounted Cash Flow method to value a company. It is used along with IRR (Internal Rate of Return) to evaluate an investment.
Net Present Value is based on the concept of Time Value of Money where we calculate the present value of future cash flows (future value).
Related Videos:
Internal Rate of Return (IRR) - https://youtu.be/x6eXfx2Tv-w
Time Value of Money - https://youtu.be/Pazp1b2LhAQ
Present Value - https://youtu.be/pxm-5MBO2dg
Present Value of an Annuity - https://youtu.be/0giLqLyijtc
एक्सेल में नेट प्रेजेंट वैल्यू या एनपीवी का कांसेप्ट और कैलकुलेशन मेथड इस वीडियो में हिंदी में समझिये। एनपीवी किसी प्रोजेक्ट, बुज़ीनेस, फ्रेंचाइज़ी या इन्वेस्टमेंट ओपोर्च्युनिटी की वैल्यूएशन करने के लिए एक महत्वपूर्ण वैल्यूएशन मीट्रिक है। इसे किसी कंपनी की वैल्यूएशन के लिए डिस्काउंटेड कैश फ्लो मेथड में भी उपयोग किया जाता है। किसी इन्वेस्टमेंट का वैल्यूएशन करने के लिए इसका उपयोग आईआरआर (Internal Rate of Return) के साथ किया जाता है।
नेट प्रेजेंट वैल्यू टाइम वैल्यू ऑफ़ मनी के कांसेप्ट पर आधारित है जहां हम फ्यूचर कॅश फ्लो (फ्यूचर वैल्यू) के प्रेजेंट वैल्यू की गणना करते हैं।
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In this video, we have explained:
What is net present value?
What is the purpose of net present value?
Why net present value calculation is used?
How to calculate net present value?
What is the calculation formula for net present value?
What is the method of NPV calculation?
How to evaluate a project, business, franchise or an investment opportunity with net present value method?
What is discounted cash flow method?
What is DCF and IRR (Internal Rate of Return) and how they are used?
What is terminal cash flow?
How net present value is calculated for a project, business or franchise?
How net present valuation method is used to evaluate an investment opportunity?
What is discount rate?
How to evaluate the value of a company?
What is the valuation method for projects, business, company, franchise and investment opportunity?
How to calculate net present value in a Microsoft Excel sheet or Google spreadsheet?
How to evaluate the net present value of any investment?
Make sure to Like and Share this video.
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Hope you liked this video in Hindi on “Net Present Value (NPV)”.

Views: 35989
Asset Yogi

The time value of money is a fundamental concept in finance - and it influences every financial decision you make, whether you know it or not. Learn the basics here.

Views: 73851
Investopedia

Time Value of Money & Net Present Value (NPV) Tutorial:
Intro Guide with Formula & Example.
The time value of money & Net Present value (NPV) Explained.
This video includes:
* Explanation of the Key Finance Concept: The Time Value of Money
* Net Present Value (NPV): An Application of the Time Value of Money
* Present Value Formula and NPV Example
* Review
Get a quick, clear and simple guide into what is the Time Value of Money and what is Net Present Value.
You will learn:
*The Time Value of Money is a Key Finance Concept saying that $1 today is worth more than $1 tomorrowbecause $1 today can be invested and worth $1 + interest tomorrow
* Net Present Value is a Time Value of Money Application that allows you to value a series of future cash flows in term’s of today’s dollars.
We discount future cash flows via the Present Value formula:
PV = FV / (1 + r)n
The Time Value of Money...A question:
Would you rather have $1,000 today
or $1,000 in a year’s time?
Firstly…
Inflation would mean $1,000 in a year would purchase less
And how do you know (with certainty) that you will receive
$1,000 in a year’s time?
But a Cornerstone Finance Concept relates to the fact that you could take $1,000 today
Invest it in a risk-free asset
And have $1,000 PLUS the interest in a year’s time
…It’s always better to have $1 today than have $1 tomorrow
Net Present Value is a Time Value of Money Application that allows you to Value a Series of Future Cash Flows in the terms of "today's value".
To calculate Net Present Value we must discount each of the future cash flows
By applying the Present Value formula to each cash flow
And then now sum the discounted cash flows
To have a Net Present Value of the project or investment
…the value of the investment in “today’s dollars”
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Views: 550
AccoFina

This video explains what the time value of money is and how impacts the value of a dollar over time. It also describes the three factors which cause inflation.
This video is for intermediate financial accounting. Students studying the present value of both notes receivable and payable will be interested in the contents of this video.
Thanks for watching!

Views: 1379
Else Grech Accounting

#Operations Research - OR
#Replacement Decision
I) Replacement of an item the efficiency of which deteriorates with time
Model - II: Replacement Policy for the items the running costs of which increases with time considering the time value of money constant during the life of the asset
Criteria for replacement:
An assets should be replaced in the beginning of the year in which the annual running cost exceeds the "Weighted Average Total Cost per year" of the preceding year
Where -
(i) "Weighted Average Total Cost per year" means the "The Weighted Total Cost till the year divided by the cumulative PV Factor"
(ii) "The Weighted Total Cost till the year" means the summation of the "Cumulative PV of Running Cost" and "Depreciation Cost of the year"
(iii) "Cumulative PV Running Cost" means the cumulative total of the present values of the annual running costs till the year
(iv) "Depreciation Cost" means the cost of the asset minus the resale/scrap value of the asset for the year
How to calculate Present Value?
FV = P (1 + r)^n is the formula to find the future value of a sum
So, PV = FV / (1 + r)^n
and if we take PV of Re 1, then we can have the PV Factor as
PV = 1/(1 + r)^n
If we multiply the future values of the running costs, we can have the present values of all the future running costs and then, ultimately, the Cumulative PV of running costs.
Replacement Decision - 5
Case:
A company is considering to install a machine costing overall Rs. 60,000. The Running costs are estimated to be Rs. 10,000 for the first 5 years, increasing every year by Rs. 3,000 in the sixth and subsequent years. The rate of return on all the investments of the company is 10% What is the optimal replacement period?
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- www.prashantpuaar.com

Views: 10419
Prashant Puaar

Views: 481
ProfAlldredge

In the video, 11.02 - Present Value Tables – Time Value of Money – Lesson 1, Roger Philipp, CPA, CGMA, explains present value of a lump sum and present value of an ordinary annuity, or annuity in arrears, how to find the present value factors in a present value table and how to apply the knowledge in calculating the present value of a bond at issuance. Future value concepts are also covered, but only briefly because present value is more relevant for the CPA Exam. Roger also breaks down how the present value of an annuity is just a summing of multiple present value of a lump sum values.
Be sure to watch video, 11.02 - Present Value Tables – Time Value of Money – Lesson 2, for the rest of Roger’s in-depth explanation of present value concepts and how they apply to bonds.
Connect with us:
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Video Transcript Sneak Peek:
Ok, we talked about present value as far as the bonds. Let's now look at this and apply it. Now, if you come back over here, we said how do you figure out the proceeds on the bond? We said face, par, million dollar face times the present value of the lump sum, 10 percent, boom. Plus, 80,000 present value of an ordinary annuity, 5 years, 10 percent, boom.
So the question is, what does this mean, where do these factors come from? Those are called present value. If you look in your notes you will see present value of an amount. That is present value of a lump sum. That's the amount you need to invest today at a certain interest rate for so many years to get back a dollar in the future.

Views: 12695
Roger CPA Review

Financial Calculator Time Value of Money: The 5 TVM Buttons What are they & How to use them.
Support the AccoFina Patreon if you're a fan, or believer, in my work: https://patreon.com/accofina
Time Markers:
Introduction to Financial Calculators and the Time Value of Money 0:12
2x Example Questions 1:00
Live Demonstration with Example Answers 1:24
Bonus Tip: Avoid the Dreaded 'Error 5' 6:08
Conclusion and Wrap Up 8:20
FINANCIAL CALCULATOR TIPS & GUIDES
Time Value of Money
“What all those main buttons mean and do.”
Using a Texas Instruments (TI) BA II Plus
TIME VALUE OF MONEY
The most common function of financial calculators is using the Time Value of Money functions and buttons.
These are the 5 prominent buttons that allow you to calculate:
* Present Value (PV)
* Future Value (FV)
* Payments or Cash Flows
* Number of Periods
* Interest Rate
The key idea:
Any question you’re asked will give you (or allow you to deduce) 4 of the 5 inputs ...then you use the calculator to compute the missing 5th value to have your answer!
“We go through 2x Live Examples to explain everything”
Bonus Tip: Avoid 'the Dreaded' Error 5!
2x Examples:
(a) Calculate monthly mortgage payments on a 30-year,
$300,000 loan
at a 5% rate
(b) How many years to save up for a $80k car if I can save $1,000 a month,
earn 7% on my savings,
and already have $5k saved?
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Views: 24
AccoFina

Hello friends! In this video you will learn the following concepts:
What is an Annuity?
Annuities : Annuity Due , Finding Future Value ?
Time value of money?
Future value?
Present value?
Annuity Introduction& Formula ?
Meaning and types of Annuity?
What is an ANNUITY and how does it work?
Types of annuities?
How to remember its formulas?
What are the advantages of annuities?
Ordinary annuity?
Annuity due?
How to solve annuity problems?
One of the most common topics asked in JAIIB in Accounting and Finance Management.

Views: 21900
GrowYourself

Title: Money and Finance Crash Course - Lecture 1: Time Value of Money, Present Value, Future Value
In this lecture, you will understand why $1 today is not equivalent to $1 tomorrow, what it means by Present Value, Future Value, Time value of Money, compounding, discounting, why your investment can grow bigger with compound interest. All of these concepts are basics of Finance at which you need to excel before you can go further in finance field.
Link to the course on Udemy: https://www.udemy.com/finance-hien-minh-luu/?couponCode=MANUNI
Thank you!
Visit our channel for more tutorials: https://www.youtube.com/channel/UCHW7Ad0xUOdjRTNbFuUDWew/videos
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Views: 1931
HM Education Finance

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Indepth Analysis through 300+ lectures and case studies for CA / CFA / CPA / CMA / MBA Finance Exams and Professionals
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Welcome to one of the comprehensive ever course on Financial Management – relevant for any one aspiring to understand Financial Management and useful for students pursing courses like CA / CMA / CS / CFA / CPA, etc. A Course with close to 300 lectures explaining each and every concept in Financial Management followed by Solved Case Studies (Video), Conversational Style Articles explaining the concepts, Hand outs for download, Quizzes and what not??
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This course is about Financial Management. By taking up this course, you will have opportunity to learn the all facets of Financial Management.
Knowledge on Financial Management is important for every Entrepreneur and Finance Managers. Ignorance in Financial Management can be disastrous because it would invite serious trouble for the very functioning of the organisation.
This is a comprehensive course, covering each and every topic in detail. In this course,you will learn the Financial Management basic concepts, theories, and techniques which deals with conceptual frame work. Following topics will be covered in this course
a) Introduction to Financial Management (covering role of CFO, difference between Financial Management, Accounting and other disciplines)
b) Time Value of Money
c) Financial Analysis through Ratios (covering ratios for performance evaluation and financial health, application of ratio analysis in decision making).
d) Financial Analysis through Cash Flow Statement
e) Financial Analysis through Fund Flow Statement
f) Cost of Capital of Business (Weighted Average Cost of Capital and Marginal Cost of Capital)
g) Capital Structuring Decisions (Capital Structuring Patterns, Designing optimum capital structure, Capital Structure Theories).
h) Leverage Analysis (Operating Leverage, Financial Leverage and Combined Leverage)
I) Various Sources of Finance
j) Capital Budgeting Decisions (Payback, ARR, MPV, IRR, MIRR)
k) Working Capital Management (Working Capital Cycle, Cash Cost, Budgetary Control, Inventory Management, Receivables Management, Payables Management, Treasury Management)
This course is structured in self learning style.
It will have good number of video lectures covering all the above topics discussed.
Simple English used for presentation.
Take this course to understand Financial Management comprehensively.
Mandatory Disclosure regarding course contents:
This course is basically a bundle of following courses:
a) Time Value of Money
b) Cash Flow Statement Analysis
c) Fund Flow Statement Analysis
d) Finance Management Ratio Analysis
e) Learn how to find cost of funds
f) Learn Capital Structuring
g) Learn NPV and IRR Techniques
h) Working Capital Management.
If you are purchasing this course, make sure you don't purchase the above courses.
Also note, this course is also bundled in comprehensive course named
Accounting, Finance and Banking - A Comprehensive Study.
So if you are purchasing above course, make sure you don't purchase this course.
• Category:
Business
What's in the Course?
1. Over 346 lectures and 48 hours of content!
2. Understand Basics of Financial Management
3. Understand Importance of Time Value of Money
4. Understand Financial Ratio Analysis
5. Understand Cash Flow Analysis
6. Understand Fund Flow Analysis
7. Understand Cost of Capital
8. Understand Capital Structuring
9. Understand Capital Budgeting Process
10. Understand Working Capital Management
11. Understand Various sources of Finance
Course Requirements:
1. Students can approach with fresh mind
Who Should Attend?
1. Any one who wants to learn Financial Management comprehensively
2. MBA (Finance) students
3. CA / CMA / CS / CFA / CPA / CIMA

Views: 7108
CARAJACLASSES

What is PRESENT VALUE? What does PRESENT VALUE mean? PRESENT VALUE meaning, definition & explanation.
In economics, present value, also known as present discounted value, is the value of an expected income stream determined as of the date of valuation. The present value is always less than or equal to the future value because money has interest-earning potential, a characteristic referred to as the time value of money, except during times of negative interest rates, when the present value will be less than the future value. Time value can be described with the simplified phrase, “A dollar today is worth more than a dollar tomorrow”. Here, 'worth more' means that its value is greater. A dollar today is worth more than a dollar tomorrow because the dollar can be invested and earn a day's worth of interest, making the total accumulate to a value more than a dollar by tomorrow. Interest can be compared to rent. Just as rent is paid to a landlord by a tenant, without the ownership of the asset being transferred, interest is paid to a lender by a borrower who gains access to the money for a time before paying it back. By letting the borrower have access to the money, the lender has sacrificed the exchange value of this money, and is compensated for it in the form of interest. The initial amount of the borrowed funds (the present value) is less than the total amount of money paid to the lender.
Present value calculations, and similarly future value calculations, are used to value loans, mortgages, annuities, sinking funds, perpetuities, bonds, and more. These calculations are used to make comparisons between cash flows that don’t occur at simultaneous times, since time dates must be consistent in order to make comparisons between values. When deciding between projects in which to invest, the choice can be made by comparing respective present values of such projects by means of discounting the expected income streams at the corresponding project interest rate, or rate of return. The project with the highest present value, i.e. that is most valuable today, should be chosen.

Views: 1862
The Audiopedia

This video explains what a perpetuity is and how to calculate its present value using a formula.
Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com
To like us on Facebook, visit https://www.facebook.com/Edspira
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Views: 84099
Edspira

Here is a Complete Free Guide on
Equity Linked Saving Scheme (ELSS Funds)- https://www.elearnmarkets.com/pages/elss
Time is our greatest asset. Learn more about compounding and discounting cash flows here in short the time value of money-
https://www.elearnmarkets.com/subject/basic-finance

Views: 1320
Elearnmarkets.com

(1) Part 1 explains the concepts of net present value
(2) Part 2 shows how to calculate NPV on Texas Instruments BA II Plus Professional

Views: 341347
collegefinance

The time value of money (TVM) is the concept that money available at the present time is worth more than the identical sum in the future due to its potential earning capacity.
CMA Chander Dureja provides Best Video Classes For CA ,CMA, CS Inter/Executive and Final For Strategic Financial Management(SFM ),Financial management(FM) And Cost and Management Accounting -9811981369

Views: 77657
CMA. Chander Dureja

This video shows how to calculate the future value of an annuity due. An annuity due is a series of periodic cash flows that begin today. Thus, if we were going to deposit $500 annually in a savings account starting today, we could calculate the balance after 30 years. This is just one example of what it means to calculate the future value of an annuity due. It is different from the future of an ordinary annuity, because with the ordinary annuity you wouldn't make the first deposit until the end of the first period (with an annuity due, you make the first cash flow today). The video provides a formula to show you how to calculate the future value of an annuity due.
Edspira is your source for business and financial education.
To view the entire video library for free, visit http://www.Edspira.com
To like Edspira on Facebook, visit https://www.facebook.com/Edspira
To sign up for the newsletter, visit http://Edspira.com/register-for-newsletter
Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams.
To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com
To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
To follow Michael on Facebook, visit https://www.facebook.com/Prof.Michael.McLaughlin

Views: 8222
Edspira

#Operations Research - OR
#Replacement Decision
I) Replacement of an item the efficiency of which deteriorates with time
Model - II: Replacement Policy for the items the running costs of which increases with time considering the time value of money constant during the life of the asset
Criteria for replacement:
An assets should be replaced in the beginning of the year in which the annual running cost exceeds the "Weighted Average Total Cost per year" of the preceding year
Where -
(i) "Weighted Average Total Cost per year" means the "The Weighted Total Cost till the year divided by the cumulative PV Factor"
(ii) "The Weighted Total Cost till the year" means the summation of the "Cumulative PV of Running Cost" and "Depreciation Cost of the year"
(iii) "Cumulative PV Running Cost" means the cumulative total of the present values of the annual running costs till the year
(iv) "Depreciation Cost" means the cost of the asset minus the resale/scrap value of the asset for the year
How to calculate Present Value?
FV = P (1 + r)^n is the formula to find the future value of a sum
So, PV = FV / (1 + r)^n
and if we take PV of Re 1, then we can have the PV Factor as
PV = 1/(1 + r)^n
If we multiply the future values of the running costs, we can have the present values of all the future running costs and then, ultimately, the Cumulative PV of running costs.
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Prashant Puaar

This video explains the concept of Net Present Value and illustrates how to calculate the Net Present Value of a project via an example.
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Edspira

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Short trick to calculate present value of annuity on calculetar usefull for CA CPT students and cs student
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Views: 40080
Ronak mungadiya

What is NET PRESENT VALUE? What does NET PRESENT VALUE mean? NET PRESENT VALUE meaning - NET PRESENT VALUE definition - NET PRESENT VALUE explanation.
Source: Wikipedia.org article, adapted under https://creativecommons.org/licenses/by-sa/3.0/ license.
In finance, the net present value (NPV) or net present worth (NPW) is a measurement of the profitability of an undertaking that is calculated by subtracting the present values (PV) of cash outflows (including initial cost) from the present values of cash inflows over a period of time. Incoming and outgoing cash flows can also be described as benefit and cost cash flows, respectively.
Time value of money dictates that time affects the value of cash flows. In other words, a lender may give you 99 cents for the promise of receiving $1.00 a month from now, but the promise to receive that same dollar 20 years in the future would be worth much less today to that same person (lender), even if the payback in both cases was equally certain. This decrease in the current value of future cash flows is based on the market dictated rate of return. More technically, cash flows of nominal equal value over a time series result in different effective value cash flows that make future cash flows less valuable over time. If for example there exists a time series of identical cash flows, the cash flow in the present is the most valuable, with each future cash flow becoming less valuable than the previous cash flow. A cash flow today is more valuable than an identical cash flow in the future because a present flow can be invested immediately and begin earning returns, while a future flow cannot.
Net present value (NPV) is determined by calculating the costs (negative cash flows) and benefits (positive cash flows) for each period of an investment. The period is typically one year, but could be measured in quarter-years, half-years or months. After the cash flow for each period is calculated, the present value (PV) of each one is achieved by discounting its future value (see Formula) at a periodic rate of return (the rate of return dictated by the market). NPV is the sum of all the discounted future cash flows. Because of its simplicity, NPV is a useful tool to determine whether a project or investment will result in a net profit or a loss. A positive NPV results in profit, while a negative NPV results in a loss. The NPV measures the excess or shortfall of cash flows, in present value terms, above the cost of funds. In a theoretical situation of unlimited capital budgeting a company should pursue every investment with a positive NPV. However, in practical terms a company's capital constraints limit investments to projects with the highest NPV whose cost cash flows, or initial cash investment, do not exceed the company's capital. NPV is a central tool in discounted cash flow (DCF) analysis and is a standard method for using the time value of money to appraise long-term projects. It is widely used throughout economics, finance, and accounting.
In the case when all future cash flows are positive, or incoming (such as the principal and coupon payment of a bond) the only outflow of cash is the purchase price, the NPV is simply the PV of future cash flows minus the purchase price (which is its own PV). NPV can be described as the "difference amount" between the sums of discounted cash inflows and cash outflows. It compares the present value of money today to the present value of money in the future, taking inflation and returns into account.
The NPV of a sequence of cash flows takes as input the cash flows and a discount rate or discount curve and outputs a price. The converse process in DCF analysis—taking a sequence of cash flows and a price as input and inferring as output a discount rate (the discount rate which would yield the given price as NPV)—is called the yield and is more widely used in bond trading.

Views: 1730
The Audiopedia

Time value of money means that money increases as time passes by ...now how is this possible ....simple , the interest component gets added to the money as each day passes by ...so a diollar received today is always more valuable than dollar received tommorrow because a days interest is added to the day's dollar !
Say ,i deposit a FD of 100 Rs witrh axis bank with 10 % rate of annual interest , at the end of the year i get 110 Rs ...that 10 Rs is the value by which my money (FD of 100 Rs ) increased over time !
I guess , you will never have doubt again on this topic !

Views: 50
Make Knowledge Free

This video is made for BBA and HSC students in order to clarify the concept of time value of money.besides it, the concept of present value of an annuity also has been effectively discussed. This video is a Bangla tutorial video both for HSC and BBA students. The reason for making videos on this topic is that, time value of money is the foundation of the financial management.
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Easy Learning Academy

Hi Everyone, it's Christina from Smartly, and I am so excited to share with you one of my favorite tools in personal finance.This 3-part mini class is going to get a little technical on you, but this topic is SO important, and if you can use it correctly it will make every financial decision easier.
Let’s dive right in and start learning about the ‘Time Value of Money’
and the broad definition of the Time Value of Money states that a dollar today is worth more than a dollar in the future.
It also says that a dollar in the past was worth more than a dollar today
This is for 2 reasons, and we’re going to cover the first in this video
Inflation
In our expanding economy the cost of goods and services increases over time, and the average annual increase viewed on a macro scale is called inflation. I’m not going to get into the economic mechanics of inflation right now, because that’s a real snoozer, but just know this — it’s a reality, and historically the average annual rate of inflation has been about 3%. As much of a bummer as this is, many economists actually believe that average inflation is a good sign that the economy is healthy. Yay inflation!
We all remember when things were cheaper.
“Back in my day the price of a cup of coffee was just 5¢!”
That’s not just a natural tendency for people to become cranky and crochety over time, that’s inflation talking! If today 5 dollars for a cup of coffee feels about right, just wait a few years and you’ll find your also speaking with the voice of inflation.
“Back in my day the price of a cup of coffee cost 5 dollars...”
Here’s an example: If the cost of a 1/2 gallon of milk today is $2.43, a similar 1/2 gallon of milk will likely cost $2.50 in one year with average inflation. What’s the big deal? who needs to sweat 7¢, right? Wrong — that 3% decrease in buying power per year means that in 6 years that same amount of milk will cost 20% more, and in 10 years the cost will rise 40% when compared with today. In just over 23 years you’ll need twice as much money to buy the same amount of milk as you do today, or you’ll be stuck buying half as much. Do you think in 23 years you’ll be satisfied with half the milk?
Not likely.
This issue is so important for artists because many of us are subject to the changing cost of materials, rental space, manufacturing services, and a million other expenses that we’re managing on our own. More often than not, we’re self employed, so there’s no one offering up annual cost of living increases to our income. When we start out it’s not unusual to make our art practices work by *just getting by*-- but after a few years what was *just getting by* may no longer make ends meet. So how do we keep up? I’ll get into that in the next video.

Views: 2156
Smartly

TVM is an important topic for CA/CS/CMA and MBA finance students. Understanding this topic is key to solving capital budgeting questions.
This is my first video and I realize my narration is not perfect. But I will improve with practice. Thanks for

Views: 3634
Knowledge Guru

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