Time Value of Money
According to the simple calculator on Bankrate.com, if I place $5000 in a saving account earning 2.50% Interest compounded at the end of a four year span I would have $10,558.93 accumulated in my account. Setting the annual interest option to semi-annual I would have $10,563.82. This is a difference of $4.89. Setting the annual interest rate to 3% compounded annually I would have $10,716.56 in a four year span. Setting the Annual interest option to semi-annual I would have accumulated $10,723.70 in four years. A difference of $7.14. Setting the interest rate to 2% the calculator states. You would have $10,403.27 for annually compounded interest. And $10,406.36 for semi-annual in a four year span. A difference of $3.09. I find it incredible how a fraction of a percent interest will affect your finances.

Considering there is a small amount of interest earned on a savings account the best thing would be to pay off the debt ASAP. The circumstances here are the rate of interest on both the credit card, the savings account and the rate of inflation. The rate of inflation makes the value of money lower over time. You also have to factor in how much money you can earn in interest in the savings account before you must pay off the bill. Earning interest on the savings account is most suitable until you have to pay the balance off at the last possible day. For example the interest rate on the savings account was greater than 14% then it would be more desirable to earn the interest as long as the inflation rate did not devalue the money. If you had a huge sum of money in the saving account and you gained more interest than you pay on your debt, then paying off your debt wouldn’t be as much of a priority.

Note: The simple savings calculator on Bankrate.com would not let me uncheck or enter a 0 for the monthly deposit option. All calculations above are based on an initial balance of $5.000 and a monthly payment of $100. The Class syllabus says...

...TimeValue of Money
The timevalue of money (TVM) or, discounted present value, is one of the basic concepts of finance and was developed by Leonardo Fibonacci in 1202. The timevalue of money (TVM) is based on the premise that one will prefer to receive a certain amount of money today than the same amount in the future, all else equal. As...

...Introduction
The timevalue of money is an important concept in financial management. It can be used to compare investment alternatives and to solve problems involving loans, mortgages, leases, savings, and annuities. The timevalue of money can be defined as the value of money received today instead of in the future. This is based on the premise that cash in hand today is more...

...Week 5 Assignment 1
TimeValue Of Money
FP/101 Janie Wainscott
If I placed $5,000.00 in a savings account earning 2.50% interest compounded annually. How much would you have at the end of four years? How much would you have if the interest is compounded semi-annually?
Annually, in four years, I would have a final savings balance of $13,078.86. If my interest was compounded semi-annually of $13,084.52. That is a difference of $5.66. So, there is...

...TimeValue of Money (TVM), developed by Leonardo Fibonacci in 1202, is an important concept in financial management. It can be used to compare investment alternatives and to solve problems involving loans, mortgages, leases, savings, and annuities.
TVM is based on the concept that a dollar today is worth more than a dollar in the future. That is mainly because money held today can be invested and earn interest.
A key concept...

...
The Present and Future Price of Money
Trident University International
FIN 501
Module 2: Case Assignment
Dr. John Halstead
One of the most important concepts about saving and investing is the timevalue of money. It can be used to compare investment alternatives and to solve problems involving loans, mortgages, leases, savings, and annuities. This means money paid out or received in...

...liability. Investors in corporations have limited liability. They can lose their investment, but no more.
Chapter 2
How to calculate Present values
Question 6: Perpetuities
An investment costs $1,548 and pays $138 in perpetuity. If the interest rate is 9%, what is the NPV?
Answer
NPV = −1,548 + 138/.09 = −14.67 (cost today plus the present value of the
perpetuity).
Question 7: Growing perpetuities
A common stock will pay a cash dividend of $4...

...FINANCE
TIMEVALUE OF MONEY
The aim of this paper is to learn about time-value-of-money to make optimal decisions as manger must understand the relationship between a dollars present today and a dollar in the future.
Timevalue of money
Today’s financial managers often have to compare cash payments that occur on different dates. To make optimal decisions, the...

...Finance21
Prof. Khen Enriquez
This article will explain the financial concept of timevalue of money. The overview provides an introduction to the principles at work when money grows in value over time. These principles include future value of money, present value of money, simple interest and compound interest. In addition, other concepts that...

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