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Essay / Research Paper Abstract
This is a 3 page paper that provides an overview of how to calculate present value. A discussion of future value and reverse engineering of equations is included. Bibliography lists 2 sources.
Page Count:
3 pages (~225 words per page)
File: KW60_KFfinmg1.doc
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Unformatted sample text from the term paper:
listed below. Citation styles constantly change, and these examples may not contain the most recent updates. Calculating Present Value from Future Value , 11/2010 VISIT
/aftersale.htm--properly! When making investments, one must often think about an objective matter, such as money, in a subjective context, such as the
future. This can lead to a variety of troubles, wherein individuals try to apply quantitative analyses to market forces in order to predict the future behavior of those markets in
order to know which to invest in. While these types of predictions are always subject to being wrong, the underlying principal is a sound one: the value of money tends
to change over time. The importance of such an understanding is best shown in the context of a situation where the future can accurately be predicted: an investment with a
given interest rate. That said, how can one know what to do with money today that will lead to favorable results in the future? This paper will present information on
how to go about determining the size of a deposit necessary to accumulate a certain amount of value by a certain date, given a known interest rate. This paragraph helps
the student explain what present value calculation is and how it might be useful. The process of determining how much of a deposit is required in order to reach a
future target value is called present value calculation. It is a derivative of another standard financial calculation with which the majority of people are familiar: future value calculation. One makes
projects about the future value of money all the time based on checking and savings account interest rates, and so on. However, many are stymied when it comes to calculating
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