What is the time value of money case?
The case illustrates practical usage of the time value of money concept and techniques to quantitatively evaluate the classic decision of buying versus renting a home. After working through the case and assignment questions, students will be able to do the following: Understand the practical concepts and techniques of the time value of money.
What is the study of time value of money?
This affects the future cash flow over the life of asset. This leads to the study of time value of money. While taking financial decisions a financial manager compares the present value of total cash inflows with the total cash outflows associated with a project/proposal to determine its profitability.
Why is time value of money important?
The concept of time value of money is also useful in selecting the highest paid investment option amongst all available options of investment. The concept is also useful in finding out the rate of return if present value and future value of a cash stream is available. Time value of money is a very useful concept in financial management.
Time value of money: A case study on its concept and its application