Practice present value, future value, annuities, perpetuities, and loan amortisation. Free questions with step-by-step solutions for all TVM calculations.
Start practising now — it's free Read study guidesThe time value of money is the foundational concept of finance: a dollar today is worth more than a dollar in the future because today's dollar can be invested to earn a return. TVM underlies bond valuation, lease accounting, pension obligation measurement, capital budgeting, and virtually every other topic in finance.
Present value discounts future cash flows back to today. Future value compounds today's dollars forward. Annuities are series of equal periodic payments — ordinary annuities have payments at period end, annuities due at period beginning. Perpetuities pay forever. Loan amortisation schedules separate each payment into interest and principal components.
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