Lesson 1256 of 1524
Time Value of Money III: Unequal Multiple Payment Values
These future cash flows could involve inflows or outflows of cash in unequal amounts.
Practice this chapterThese future cash flows could involve inflows or outflows of cash in unequal amounts. This section analyzed the determination of present and future value of these uneven or mixed cash flows
This is relevant for investments for the future and for analyses of the value of projects that require investment today to produce expected flows of cash later. This section discussed the use of two tools for managing and understanding the time value of money and its many applications when the flows of cash are unequal: the TI BA II Plus™ Professional financial calculator and…
cash flow — the amount of cash actually flowing into and out of a business, as opposed to income (which is based on accounting rules, accruals, and reports). future value — the value of an asset or holding at a point in the future based on expectations of that asset’s growth at a certain rate of return. flows of cash — unequal: the TI BA II Plus™ Professional financial calculator and…. capital investment — a major expenditure that requires a large up-front investment and is expected to generate substantial cash inflow in return.
Worked example
What does “cash flow” mean in Time Value of Money III: Unequal Multiple Payment Values?
- 1Use the wording this chapter gives for cash flow.
- 2The book says: the amount of cash actually flowing into and out of a business, as opposed to income (which is based on accounting rules, accruals, and reports).
- 3Do not use the meaning of future value. That term means the value of an asset or holding at a point in the future based on expectations of that asset’s growth at a certain rate of return.
Result: the amount of cash actually flowing into and out of a business, as opposed to income (which is based on accounting rules, accruals, and reports)
Why. That is the meaning this chapter gives for cash flow.
Do not swap cash flow and future value. cash flow means the amount of cash actually flowing into and out of a business, as opposed to income (which is based on accounting rules, accruals, and reports). future value means the value of an asset or holding at a point in the future based on expectations of that asset’s growth at a certain rate of return.
Practice margin
This chapter
A fresh set from this chapter only. Choose 10 or 20. Multiple choice and fill-in, with no repeat inside the set.