Flashcards in Module 6 (Time Value Of Money – 1) Deck (11):

1

## The time value of money concept indicates that the value of an amount received today will be...

### greater than the value of receiving the same amount in the future.

2

## A percentage that represents the value of something that must be give it up to acquire or achieve something else.

### opportunity cost

3

## The process of lowering a future value to become a smaller value in the present.

### discounting

4

## The process of increasing a present value into a larger future value.

### compounding

5

## The higher the interest rate used, the larger the future value will be of the...

### principal amount.

6

## The future value of an investment is higher when...

### the number of periods and the interest increases.

7

## When calculating a value on a HP–10bll, how do you get the value you're looking for?

### Punch the value you're looking for last.

8

## Consistent cash flow amount saved or received.

### Annuities

9

## This is an annuity in which payments are received at the end of each period. (fixed-rate mortgage).

### annuity ordinary

10

## An annuity in which payments are received at the beginning of each period. (like a life insurance policy)

### annuity due

11