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| Topic: |
Business
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| Number of pages / Number of words: |
3 / 800 |
Essay's paper body
A higher rate of return and longer period of time would lead to a lower present value of the future money.
Conversely, a lower rate of return and shorter period of time would lead to a higher present value of the future money. The length of time you have to choose is obvious but what is the rate of return you should choose for discounting the future money? You have to choose a realistic rate of return that makes some sense...
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The length of time you have to choose is obvious but what is the rate of return you should choose for discounting the future money? You have to choose a realistic rate of return that makes some sense.
But the problem is that different investments may yield different rates of return. Some of these investments may be more risky than others...
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Present Value of Future Money
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