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TIME VALUE OF MONEY - Coggle Diagram
TIME VALUE OF MONEY
annuities
1.a cash flow stream i which the cash flows are all equal and occur at regular intervals
- ordinary annuities - occur at the end of the period
- annuity due - occur at the beginning of the period
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A ringgit received today is worth more than a Ringgit received tomorrow
- can be invested to earn interest
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future value
- future value of a lump sum
- future value of a multiple cash flow
determines the amount that a sum of money invested today will grow to in given period of time/ compounding
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- a finite set of payments that an investor will receive or invest over time
- equal to sum of the future values of the individual cash flows
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using table 