Скачать или смотреть Time value of money (TVM) & Factors behind TVM/Risk and Uncertainty,Inflation,Consumption,Investment

What is time value of money?
The time value of money (TVM) is the idea that moneyavailable at the present time is worth more than the sameamount in the future due to its potential earning capacityThis core principle of finance holds that, provided moneycan earn interest, any amount of money is worth more thesooner it is received
Factors behind TVM
Risk and Uncertainty: As we know future is nevercertain and we can’t determines the risk involved in future because outflow of cash is in our hand as paymentwhere as there is no certainty for future cash inflows.Inflation: In an inflationary economy, the money received today, has more purchasing power than the moneyto be received in future. In other words, a rupee todayrepresents a greater real purchasing power than a rupeein future.
Consumption: Individuals generally prefer current consumption to future consumption.
Investment opportunities: An investor can profitably use the received money today to get higher return tomorrow or after a certain period of time.