Time Value Money

0.0(0)
studied byStudied by 0 people
learnLearn
examPractice Test
spaced repetitionSpaced Repetition
heart puzzleMatch
flashcardsFlashcards
Get a hint
Hint

Future Value of a series of deposits

Get a hint
Hint

The total amount you'll have at the end after depositing a fixed amount each year for a number of years at a specific interest rate, calculated using the formula: FV = PMT * [((1 + r)^n - 1) / r].

Get a hint
Hint

Total Interest Earned

Get a hint
Hint

The amount obtained by subtracting the total amount deposited from the future value.

Card Sorting

1/12

Anonymous user
Anonymous user
encourage image

There's no tags or description

Looks like no tags are added yet.

Study Analytics
Name
Mastery
Learn
Test
Matching
Spaced

No study sessions yet.

13 Terms

1
New cards

Future Value of a series of deposits

The total amount you'll have at the end after depositing a fixed amount each year for a number of years at a specific interest rate, calculated using the formula: FV = PMT * [((1 + r)^n - 1) / r].

2
New cards

Total Interest Earned

The amount obtained by subtracting the total amount deposited from the future value.

3
New cards

Future Value of a Lump Sum

The future value of a single deposit left untouched, calculated with compound interest using the formula: FV = PV * (1 + r)^n.

4
New cards

Simple Interest

Interest calculated on the principal amount only, not on the interest accrued.

5
New cards

Present Value Calculations

Calculating the present value of future income streams, for a finite period (annuity) or to cover inheritances.

6
New cards

Effective Annual Rate (EAR)

The interest rate that is adjusted for compounding over a given period, calculated using the formula: EAR = (1 + (Nominal rate / m))^m - 1, where m is the number of compounding periods per year.

7
New cards

Total Return

The overall gain or loss made on an investment over a specified period.

8
New cards

Annual Return

The percentage gain or loss on an investment over a year.

9
New cards

Loan Payments

The process of calculating monthly payments required to repay a loan.

10
New cards

Future Value

The value of an investment at a specified date in the future, calculated using the formula: FV = PV * (1 + r)^n.

11
New cards

Future Value of an Annuity

The future value of a series of equal payments made at regular intervals, calculated using the formula: FV = PMT * [((1 + r)^n - 1) / r].

12
New cards

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return, calculated using the formula: PV = FV / (1 + r)^n.

13
New cards

Present Value of an Annuity

The present value of a series of equal payments made at regular intervals, calculated using the formula: PVA = PMT * [(1 / r) - (1 / (r(1 + r)^n))].