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Learn about the time value of money (TVM) to figure out loan payments, save for college and retirement, buy a house, lease or purchase a car, and make long-term business decisions.
Learn how understanding the time value of money can help you figure out loan payments, save for college and retirement, rent or buy a house, lease or purchase a car, and make long-term business decisions. Accounting professors Jim and Kay Stice explain the linked concepts of the time value of money (TVM) and compound interest, show you how to calculate TVM in Microsoft Excel or on a calculator, and how to apply TVM to a variety of personal and professional financial scenarios.
Learn more about interest rates and investments in the Stices' Finance Fundamentals course.
Overview
Syllabus
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Introduction
- Welcome
- The time value of candy
- Time value of money: Concept and applications
- Overview of time value of money terms
- Columbus and the power of compounding
- Example: Interest rate impact
- Example: Compounding period
- Car salesperson
- Using business calculators and Excel functions
- Practicing using business calculators and Excel
- Computing a car payment
- Computing a house payment
- Computing a house payment with a balloon payment at the end
- Computing the amount you can afford to borrow
- Start saving early
- Growth in savings
- Saving for a target amount for a house
- Saving for retirement
- Time value of money dangers: A payday loan
- Conclusion
