Time Value Management

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Issue:

Miscellaneous

 

Written by:

Leann D

 

Date added:

January 17, 2015

 

Level:

University

 

Grade:

B

 

No of pages / words:

7 / 1693

 

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2105 times

 

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Essay content:

The actual value of a lottery prize is a great example to use to fully understand the concept of present value. If the lottery prize is $1 million, it is not worth that full amount if it is set up to pay the winner $50,000 a year for twenty years with a percentage rate of 10 percent added on to it. If the first payment is paid immediately, the present value of that prize is only $468,246 (Henderson, 2002) Future Value is the value of that investment over time, after interest has been gained and can be expressed as FV = PV (l + i) n (Block & Hirt, 2005)...
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If the first payment is paid immediately, the present value of that prize is only $468,246 (Henderson, 2002) Future Value is the value of that investment over time, after interest has been gained and can be expressed as FV = PV (l + i) n (Block & Hirt, 2005). An annuity is a series of equal amounts of payments or receipts that are consecutive and usually occur at the end of a period of time...
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