The significance of time value of money in financial management3. After reading this chapter, you should be able to 1. The hour glass shape of powerpoint can represent the conversion of time as well as the progress based on time. Discoun download as many of our powerpoint templates, animations and clipart images as you need. What are the different time value of money concepts. The time value of money tvm is the idea that money available at the present time is worth more than the same amount in the future due to its potential earning capacity. Whenever we talk about money, the amount of money is not the only thing that matters. Some of the more mindbendingeconomic and financial concepts are the ideas ofcompound interest, inflation,present value, and future value.
One of the most fundamental concepts in finance is that money has a time value. Chapter 6 time value of money study guide by jakej352 includes 24 questions covering vocabulary, terms and more. Time concepts am and pm cards40 clipit cards42 sorting cardsresponse sheet check a. In order to determine the amount needed to invest in case of saving or the cost of borrowing, we need to understand the time value of money. Since n3 search only row 3, and find the answer to the problem is 5% at top of column. Time value of money video present value khan academy. Studentcentric learning material centers around three major competencies. This concept is referred to as the time value of money. Mba,phd c assistant director of financial literacy. This 90minute webinar will discuss basic time value of money concepts and the application of time value of money concepts to reallife financial planning decisions. Money concepts independent brokerdealer money concepts.
Time value of money part i economic basis to evaluate engineering projects time management the expected time to deliver this module is 50 minutes. A free powerpoint ppt presentation displayed as a flash slide show on id. If an individual is given an option a to receive rs. Because of the time value of money, payments made at different points in time cannot be directly compared. The first one in the time value of money concept that we discuss is to calculate the future value of a single amount. Time value of money is a concept that recognizes the relevant worth of future cash flows arising as a result of financial decisions by considering the opportunity cost of funds. Evaluation lecture course exam % of marks duration of examination coverage scope i test1 t1 20 1 hour syllabus covered upto test 1 ii test 2 t2 25 1 hour 15 minutes mainly syllabus covered after test1, plus some questions from portions covered upto test 1 iiitest3 t3. When investing from outside of the united states, you are subject to the securities and tax regulations governing your jurisdiction.
Money has a time value, in that individuals place a higher value on a given amount, the earlier it is received. Ppt time value of money powerpoint presentation free to. So, to think about this or to make it a little bit more concrete, lets assume that we live in a world that if you put money in a bank, you are guaranteed 10% interest, 10%. The time value of money is a basic financial concept that holds that money in the present is worth more than the same sum of money to be received in the future. Time value of money the concept of time value of money. Key finance concepts, including tvm time value of money, rates of return, and the 21st century historically low levels of interest rates, are developed early on in the course to instill confidence in students, so they can later apply them to complex financial problems. Adjusting for inflation is a completely different concept, which is covered in. Introduction to time value of money authorstream presentation. Give them a chore chart and an allowance for successfully completing their jobs. Similarly, the clipart of money can display the cost over time. A dollar that you receive today can be invested such that you will have more than a dollar at some future time. Based on this, we can use the time value of money concept to calculate how.
The time and cost management metaphor slide has a unique set of icons to present business concepts. Consumption forgone has value investment lost has opportunity cost. The time value of money powerpoint ppt presentation. The premise of these concepts is to determine whether a series of payments for an extended period of time in the future is more valuable than a lump sum payment today. We would like to show you a description here but the site wont allow us. Quizlet flashcards, activities and games help you improve your grades. If you study this finance tvm video tutorial in combination with what you leanr about the time value of money in your finance class, you should have. Ppt chapter 6 time value of money powerpoint presentation. Obviously, rs 10,000 today money received sooner rather than later allows one to use the funds for investment or consumption purposes. Understand the concepts of time value of money, compounding, and discounting.
These graphics could be used to communicate many business and analysis concepts. Time management powerpoint presentation content slides include topics such as. The time value of money establishes that there is a preference of having money at present than a future point of time. An amount of money received today is worth more than the same dollar value received a year from now. Discounted cash flow npv time value of money examples. This helps you give your presentation on time management skills in a conference, a school lecture, a business proposal, in a webinar and business and professional representations the uploader spent hisher valuable time to.
Well, sal had talked about present and future value of money in this video, is there. The processes of compounding rates of return for several time periods out into the future, or converselydiscounting a future sum of money to. It is important to know how to distinguish between and to calculate. Time value of money how to calculate the pv and fv of money. What are discounted cash flow and the time value of money.
This 14 slide powerpoint is a simple, yet effective diagnostic assessment to gauge where your students are in regards to money concepts. The time value of money concept states that cash received today is more valuable than cash received at some point in the future. A very brief introduction to the time value of money. More generally, the time value of money is the relationship between the value of a payment at one point in time and its value at another point in time as determined by the mathematics of compound interest.
Time and money powerpoint template covers the two significant management concepts i. The free balance shape for powerpoint comprises of flat shapes and clipart icons that create a weight scale. Time value of money concepts are the cornerstone of modern finance. Time value of money which wouldyouprefer rs 10,000 today or rsm 0,000 in 5 years. That is to say that money in hand today is worth more than money that is expected to be received in the future. I promise im not going to make you learntricky formulas in this video,but i am going to. What also matters is when you have to get or when you have to give the money.
Fin 303 fall 15, part 4 time value of money professor james p. T he discounted cash flow concept dcf is an application of the time value of money principlethe idea that money that will be received or paid at some time in the future has less value, today, than an equal amount collected or paid today. The concept that money available today is worth more than the same amount of. The time value of money tvm is the concept that money you have now is worth more than the identical sum in the future due to its potential. Time is money powerpoint templates, dollars, business, watches, speed, profits, fast, hour, funds, closeup, debt, overdue, nobody, save, flow, business, income. Displaying powerpoint presentation on time value of money 265918 available to view or download. Time value of money concept facilitates an objective evaluation of cash flows arising from different time periods by converting them into present value or future value equivalents. The process weve just done is called discounting a future value to the present and the term is called the discount factor. Included are 3 question slides for each of the following categories. Powerpoint is the worlds most popular presentation software which can let you create professional time management skills powerpoint presentation easily and in no time.
Generally, an ebook can be downloaded in five minutes or less. Individuals often save money for future use or borrow money for current consumption. Understanding the time value of money investopedia. Calculate the present value and future value of various cash flows using proper. By using various time value of money concepts, a person can effectively compare various investment opportunities. Time value of money time value of money money has the ability to increase over time if it is invested interest the amount of money that is earned over a certain time period interest rate the rate interest is earned what are all these things p present value of money i interest it earned i interest rate ip f future value of money. The two slide presentation template can be used as the introduction slide of asset management or time management ppt presentation.
Define and understand the conceptual and calculation of future and present value in cash flows4. The reason is that someone who agrees to receive payment at a later date foregoes the ability to invest that cash right now. Present value is one of the more popular time value of money. September, 20 the concept of the time value of money. The four parts are the present value pv, the future value fv, the discount rate r, and the life of the investment t. Time value of money tvm is an important concept in financial. This is true because money that you have right now can be invested and earn a return, thus creating a larger amount of money in. Time management will help to increase your productivity and make you able to complete.
Time literally is moneythe time value of the money you have now is not the same as it will be years from now and vice versa. Time value of money tvm lessontutorial futurepresent. Money concepts registered representatives are restricted to conduct business only with residents of a state andor jurisdiction for which they are properly registered. Its important to understand them,as so many of our big money questionsthat are fundamentally emotional,can be answered clearly with math.