« previous next »

Author Question: Discuss the nature and importance of the TVM equation. What will be an ideal ... (Read 75 times)

karen

  • Hero Member
  • *****
  • Posts: 537
on: Jul 10, 2018
Discuss the nature and importance of the TVM equation.
 
  What will be an ideal response?

Question 2

A way of managing a firm's cash disbursements would be through
 
  A) accounts receivable factoring. B) zero balance accounts.
  C) lockbox system. D) floating lien.


LP

  • Sr. Member
  • ****
  • Posts: 302
Reply #1 on: Jul 10, 2018
Answer to Question 1

Answer: The TVM equation makes the fundamental point that money flows over time cannot simply be added or subtracted. That is why money flows need to be discounted or compounded to one point in time, whether the flows are lump sums or annuities. Discounting or compounding can be done mathematically or with a TVM table, financial calculator, or spreadsheet. The TVM equation is important because it is used in almost every financial applicationfor example, loans, the pricing of financial and real assets, assessing firm projects, savings plans, and retirement plans.

Answer to Question 2

B


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

There are approximately 3 million unintended pregnancies in the United States each year.

Did you know?

Inotropic therapy does not have a role in the treatment of most heart failure patients. These drugs can make patients feel and function better but usually do not lengthen the predicted length of their lives.

Did you know?

Vampire bats have a natural anticoagulant in their saliva that permits continuous bleeding after they painlessly open a wound with their incisors. This capillary blood does not cause any significant blood loss to their victims.

Did you know?

Acetaminophen (Tylenol) in overdose can seriously damage the liver. It should never be taken by people who use alcohol heavily; it can result in severe liver damage and even a condition requiring a liver transplant.

Did you know?

The first successful kidney transplant was performed in 1954 and occurred in Boston. A kidney from an identical twin was transplanted into his dying brother's body and was not rejected because it did not appear foreign to his body.

Comparing allele and genotype frequencies in a population with the Hardy-Weinberg equation and a Pun Comparing allele and genotype frequencies in a population with the Hardy-Weinberg equation and a Pun
Some scholars regard Walt Whitman as a poet of nature, and others, a poet of the body—a reference to Some scholars regard Walt Whitman as a poet of nature, and others, a poet of the body—a reference to
How to transform any rectangular equation to polar form How to transform any rectangular equation to polar form
How to find the equation of a line that is parallel to a line passing through a point How to find the equation of a line that is parallel to a line passing through a point
Solve the equation algebraically Solve the equation algebraically
Under ideal conditions, a single cell of the bacterium E. coli would divide every 20 minutes to ... Under ideal conditions, a single cell of the bacterium E. coli would divide every 20 minutes to ...
Video: The pH scale - Strong acids and Weak acids

For a complete list of videos, visit our video library