ECONOMICS
ECONOMIC DEVELOPMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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True
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False
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Either A or B
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None of the above
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Detailed explanation-1: -Present value is the value now of a future sum or sums discounted assuming compound interest. 10. The future value of a single sum is determined by multiplying the future value factor by its present value.
Detailed explanation-2: -Using the cost-replacement approach, the formula for Future Value of a single sum invested at establishment is Vn = Vo (1 + i)n, where: Vn is future value, Vo is present value, i is interest rate, and n is the number of years..
Detailed explanation-3: -Future value interest factor (FVIF), also known as a future value factor, is a component that helps to calculate the future value of a cash flow that will be paid at a certain point in the future. The future cash flow could be a single cash flow or a series of cash flows (such as in the case of an annuity).
Detailed explanation-4: -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.