Time Value of Money Basics Flashcards
1
Q
FV
A
Amount to which investment grows after one or more compounding period.
2
Q
FV=
A
PV(1+I/Y)^N
3
Q
PV
A
Current Value of some future cash flow
4
Q
PV=
A
FV/(1/I/Y)^N
5
Q
Annuities
A
Series of equal cash flows that occur at evenly spaced intervals over time.
6
Q
Odinary Annuity:
A
Cash flow at end of time period
7
Q
Annuity due
A
Cash flow at beginning of time period
8
Q
Perpetuities
A
Annuities w/ infinite lives
9
Q
PVperp=
A
PMT/(discount rate)
