公司理财精要9版-英文-第五章.ppt

Basic Definitions Present Value – earlier money on a time line Future Value – later money on a time line Interest rate – “exchange rate” between earlier money and later money Discount rate Cost of capital Opportunity cost of capital Required return Chapter Outline 5.1 Future Value and Compounding 5.2 Present Value and Discounting 5.3 More on Present and Future Values Key Concepts and Skills Be able to compute the future value of an investment made today Be able to compute the present value of cash to be received at some future date Be able to compute the return on an investment 5.1 Future Value and Compounding TIME VALUE OF MONEY: A dollar in hand tuday is worth more than a dollar promised at some time in the future. Future value (FV) The amount of money an investment will grow to over some period of time at some given interest rate. Inverting for a Single period Inverting for more than one period Reinvesting Compounding Interest on interest Compound interest Table 5.1 future value of $100 at 10% Figure 5.2 future value of $1 for different period and rates 5.2 Present Value and Discounting The single-period case Present value for multiple periods Discount rate 贴现率 Present value interest factor Discounted cash flow 5.3 More on Present and Future Values * * 4-* CHAPTER 5 Introduction to valuation: The time value of money