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The time value of money applies to many day-to-day decisions. Understanding the effective rate on a business loan, the mortgage payment in a real estate
- The time value of money applies to many day-to-day decisions. Understanding the effective rate on a business loan, the mortgage payment in a real estate transaction, or the true return on an investment depends on understanding the time value of money. As long as an investor can make a positive return on idle dollars, distinctions must be made between money received today and money received in the future. Explain to me how present and future value might be used in your personal life giving two specific examples for both present and future value.
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