24 - Time Value of Money
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Practice Questions
Test your understanding with targeted questions
What is the formula for simple interest?
💡 Hint: Remember, it only uses the principal!
Name the three main reasons that explain TVM.
💡 Hint: Think about factors that affect purchasing power.
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Interactive Quizzes
Quick quizzes to reinforce your learning
What does the Time Value of Money (TVM) refer to?
💡 Hint: Consider how money can grow with time.
True or False: Present value is the current worth of a future sum of money.
💡 Hint: Think about the definition of present value.
3 more questions available
Challenge Problems
Push your limits with advanced challenges
A company is considering a project with an upfront cost of ₹500,000 and expects to receive cash inflows of ₹120,000 annually for 7 years. If the required return is 10%, calculate the NPV of the project.
💡 Hint: Use the NPV formula involving discounting cash flows.
You decide to set aside ₹2,000 each year for 10 years in an account that earns 4% interest compounded annually. Calculate the future value of this annuity at the end of 10 years.
💡 Hint: This involves the future value of an ordinary annuity formula.
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