《财务管理》课程PPT教学课件（英文版）Chapter 05 The ime value ofmoney

Ch 5- The Time value of Money 2 ◎2002, Prentice Hall. Inc

Ch. 5 - The Time Value of Money © 2002, Prentice Hall, Inc

The Time value ofmoney Compounding and Discounting Single Sums (

The Time Value of Money Compounding and Discounting Single Sums

We know that receiving SI today is worth more than Sl in the future. This is due to opportunity costs The opportunity cost of receiving SI in he future is the interest we could have earned if we had received the si sooner Today Future HE UNE AMERICA THE UNITED STATES OF AMERICA ONE DOLLAR ONE DOLLAR

We know that receiving $1 today is worth more than $1 in the future. This is due to opportunity costs. The opportunity cost of receiving $1 in the future is the interest we could have earned if we had received the $1 sooner. Today Future

If we can measure this opportunity cost, we can

If we can measure this opportunity cost, we can:

If we can measure this opportunity cost, we can Translate SI today into its equivalent in the future (compounding

If we can measure this opportunity cost, we can: • Translate $1 today into its equivalent in the future (compounding)

If we can measure this opportunity cost, we can Translate SI today into its equivalent in the future (compounding Today Future K THE UNTED STATES OF AMERICA YO L ONE DOLLAR

If we can measure this opportunity cost, we can: • Translate $1 today into its equivalent in the future (compounding). Today ? Future

If we can measure this opportunity cost, we can Translate SI today into its equivalent in the future (compounding Today Future K THE UNTED STATES OF AMERICA YO L ONE DOLLAR Translate SI in the future into its equivalent today (discounting)

If we can measure this opportunity cost, we can: • Translate $1 today into its equivalent in the future (compounding). • Translate $1 in the future into its equivalent today (discounting). Today ? Future

If we can measure this opportunity cost, we can Translate SI today into its equivalent in the future (compounding Today Future K THE UNTED STATES OF AMERICA YO L ONE DOLLAR Translate SI in the future into its equivalent today (discounting) Today Future THE UNITED STATES OF AMERICA ONE DOLLAR

If we can measure this opportunity cost, we can: • Translate $1 today into its equivalent in the future (compounding). • Translate $1 in the future into its equivalent today (discounting). ? Today Future Today ? Future

future value

Future Value

Future value -single sums Ifyou deposit $100 in an account earning 6%, how much would you have in the account after l year?

Future Value - single sums If you deposit $100 in an account earning 6%, how much would you have in the account after 1 year?