A choice between money now and money later. Created by Sal Khan. Watch the next lesson: https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial/present-value/v/present-value-2?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Missed the previous lesson? Watch here: https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial/present-value/v/time-value-of-money?utm_source=YT&utm_medium=Desc&utm_campaign=financeandcapitalmarkets Finance and capital markets on Khan Academy: If you gladly pay for a hamburger on Tuesday for a hamburger today, is it equivalent to paying for it today? A reasonable argument can be made that most everything in finance really boils down to "present value". So pay attention to this tutorial. About Khan Academy: Khan Academy offers practice exercises, instructional videos, and a personalized learning dashboard that empower learners to study at their own pace in and outside of the classroom. We tackle math, science, computer programming, history, art history, economics, and more. Our math missions guide learners from kindergarten to calculus using state-of-the-art, adaptive technology that identifies strengths and learning gaps. We've also partnered with institutions like NASA, The Museum of Modern Art, The California Academy of Sciences, and MIT to offer specialized content. For free. For everyone. Forever. #YouCanLearnAnything Subscribe to Khan Academy’s Finance and Capital Markets channel: https://www.youtube.com/channel/UCQ1Rt02HirUvBK2D2-ZO_2g?sub_confirmation=1 Subscribe to Khan Academy: https://www.youtube.com/subscription_center?add_user=khanacademy
Views: 763341 Khan Academy
Subscribe to Alanis Business Academy on YouTube for updates on the latest videos: https://www.youtube.com/alanisbusinessacademy?sub_confirmation=1 If you're deciding to invest a lump-sum over a period of time you can quickly determine what the future value of that investment would be. In this brief video I'll show you how to calculate the future value of a lump-sum investment. Go Premium for only $9.99 a year and access exclusive ad-free videos from Alanis Business Academy. Click here for a 14 day free trial: http://bit.ly/1Iervwb To view additional video lectures as well as other materials access the following links: YouTube Channel: http://bit.ly/1kkvZoO Website: http://bit.ly/1ccT2QA Facebook: http://on.fb.me/1cpuBhW Twitter: http://bit.ly/1bY2WFA Google+: http://bit.ly/1kX7s6P
Views: 63131 Alanis Business Academy
The basics of how to calculate present value and net present value are explained in this short revision video.
Views: 62877 tutor2u
Clicked here http://www.MBAbullshit.com/ and OMG wow! I'm SHOCKED how easy.. Exactly what is Present Value and how will you utilize the Present Value Formula? In the event that you already understand the idea of Future Value, you will be able to easily understand Present Value. Exactly what is the "Present Value" of today's $100? It's also $100! Why? Because "present" means "today". Thus, it is $100 today (present value), and after earning interest, it may become $105 the following year (future value). Let's say that one year ago, this money was only a little more than $95, and then it earned interest all through the year, and now it's valued at$100. Exactly which is the "Past Value" of your $100? Again, very straightforward! It is $95. So... with regard to your $100 right now, Present Value is $100, Past Value is $95, and the Future Value is $105. However, that was quite a simple example to point out the concept. The important challenge in school as well as actual business is learning the specific number of your Future Value, Present Value, and Past Value, using scary looking but very simple formulas. The Present Value or Past Value Formula, simplified, resembles this: Present Value or Past Value = (1 interest rate)^n Where n = number of years. Don't be alarmed. You might prefer to watch it in action in the video above and you'll see how easy it is to use it. Just about the most confusing thing regarding the Present Value and Past Value concepts is that in many different business schools also with numerous books, Present Value and Past Value are explained almost like they're exactly the same thing. However, they are not. They are very different! Why the confusion? Because they definitely utilize the same formula. However, the result of the formula will allow you compute either the present value or the past value, depending on how the story is told. http://www.youtube.com/watch?v=zR3L5mLTi7s
Views: 224878 MBAbullshitDotCom
This video explains the concept of Net Present Value and illustrates how to calculate the Net Present Value of a project via an example. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 523325 Edspira
Subscribe to Alanis Business Academy on YouTube for updates on the latest videos: https://www.youtube.com/alanisbusinessacademy?sub_confirmation=1 In this video I use the present value equation to discount a future payment in today's dollars. We know that due to the time value of money $1,000 three years from now is not worth the same as $1,000 today. In order to make an accurate comparison we need to discount our future cash receipts to see what they would be worth today. To view additional video lectures as well as other materials access the following links: YouTube Channel: http://bit.ly/1kkvZoO Website: http://bit.ly/1ccT2QA Facebook: http://on.fb.me/1cpuBhW Twitter: http://bit.ly/1bY2WFA Google+: http://bit.ly/1kX7s6P
Views: 72764 Alanis Business Academy
How to find the Future Value when interest is compounded! YES there is a mistake in this video... my apologies, but it doesn't change the fact that this video will show you how to compute Future Value quickly and easily! Here is a link to my math videos organized by topic! https://sites.google.com/view/nabifroesemathvideos
Views: 251977 Nabifroese
More HD Videos and Exam Notes at https://oneclass.com Our goal is helping you to get a better grade in less time. We provide various exam tutorials which are specifically designed for your courses. Please go to our official website http://oneclass.com and Visit our channel for more tutorials: http://www.youtube.com/user/Notesolution Like us on Facebook: http://facebook.com/oneclass Follow us on Twitter: http://twitter.com/getoneclass Follow us on Instagram: http://instagram.com/getoneclass
Views: 438049 OneClass
Present Value calculation, concept and excel formula explained in hindi. What discount rate should we take while calculating Present Value of a single m cash flow? This concept is used in valuation of a business, project or while analysing an investment. Related Videos: Time Value of Money - https://youtu.be/Pazp1b2LhAQ Present Value of an Annuity - https://youtu.be/0giLqLyijtc Future Value - https://youtu.be/BFRGWenwulc Future Value of an Annuity - https://youtu.be/f6a7E3326QQ Future Value of Uneven Cash Flows - https://youtu.be/yHoTUk8HP-c Net Present Value (NPV) - https://youtu.be/SpHIBfPGwx8 Internal Rate of Return (IRR) - https://youtu.be/x6eXfx2Tv-w प्रेज़ेंट वैल्यू कैलकुलेशन, कांसेप्ट और एक्सेल फॉर्मूला के बारेमें इस विद्ये में समझाया गया है। किसी सिंगल कैश फ्लो के प्रेज़ेंट वैल्यू की कैलकुलेशन करते समय हमें क्या डिस्काउंट रेटलेनी चाहिए? इस कांसेप्ट का उपयोग किसी बिज़नेस, प्रोजेक्ट या इन्वेस्टमेंट का विश्लेषण करते समय किया जाता है। Share this Video: https://youtu.be/pxm-5MBO2dg Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is present value? What is the concept of present value? How to calculate the present value for any investment? How present value calculation can be used to calculate the value of returns of business or projects? How to calculate the present value of money? What is the difference between present value and future value? How to calculate the present value in Microsoft Excel sheet? How present value of perpetuity? What is the present value calculation method? What is the calculation formula for calculating the present value? How present value calculation formula is used in excel sheet? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Facebook – https://www.facebook.com/assetyogi Google Plus – https://plus.google.com/+assetyogi-ay Instagram - http://instagram.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Twitter - http://twitter.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Hope you liked this video in Hindi on “Present Value”.
Views: 13599 Asset Yogi
Project management topic on Capital budgeting techniques - NPV - Net Present Value, IRR - Internal Rate of Return, Payback Period, Profitability Index or Benefit Cost Ratio.
Views: 443956 pmtycoon
How to calculate pv factor on basic 12 digit calculator.
Views: 80522 Life Explorer
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Views: 81307 CA PAVAN KARMELE
Subscribe to Alanis Business Academy on YouTube for updates on the latest videos: https://www.youtube.com/alanisbusinessacademy?sub_confirmation=1 In this video, I show how to calculate the present value of an annuity. In addition to converting the series of payments via the traditional discounting method, I'll show how to solve the problem utilizing a handy equation.
Views: 198588 Alanis Business Academy
Download excel file: http://codible.com/pages/58 Present value (PV) function lets you calculate the present discounted value of a series of future cash flows. In this example we see how to calculate the loan amount you can borrow for a given series of equal monthly payments like, say a car loan payment. Follow us on twitter: https://twitter.com/codible Some good books on Excel and Finance: Financial Modeling - by Benninga: http://amzn.to/2tByGQ2 Principles of Finance with Excel - by Benninga: http://amzn.to/2uaCyo6
Views: 102431 Codible
Background A dollar received now is more valuable than a dollar received a year from now. If you have that dollar today, you can invest it and increase its value. Let's explain a bit further: The time of value of money is the difference in value between having a dollar in hand today and receiving a dollar sometime in the future. Why is present and future value important? Since money has a time value, we must take this time value into consideration when making business decisions. Present and future value calculations are powerful methods available in making financial decisions. Once you understand and master the calculations, you can apply these equations for restating cash flows to make them equivalent in business decisions. The calculations are building blocks for many decisions facing individuals and managers alike. In addition, these calculations allow one to calculate returns on investments, capital budgeting, and return on annuities, just to name a few. Key terms: Future value (fv) and present value (pv) are two concepts in clarifying the value of money. Future value is explained as an amount of money invested at present and will mature at the end of a given time when compounded at a given interest rate. Present value is money that must be invested now to accrue to a certain amount of money in the future when compounded. In simpler terms, present value is the value today of an amount of money in the future. Why is this important? For these situations, businesses need to find a method of weighing cash flows that are received at various periods of times (annual, years, quarters, ect). How do we go about finding the present and future value of cash flow? There are two fundamental equations that are commonly used; this video will demonstrate them throughout the presentation. Objectives: Following my discussion, you will be able to: • Have the knowledge of present value (pv) and future value (fv) • Be able to calculate the pv and fv with compounding • Have an understanding of compound interest Discussion: The video discusses the value of a dollar in hand today and applying calculations to determine what that dollar will be worth in the future. In addition, the video demonstrates the concept of wanting to have a specified amount of money in the future and the amount of money needed today in order to earn that specified amount. See the formulas used in video: Fv=pv (1+i) n Pv= (1/1+i) n FvPvn Pv=the beginning amount i= the interest rate/year n=number of years Fv=value at the end of n years. Important points: When computing compounding interest for greater than one year, remember that the interest in the next year is being paid on interest. The interest on the original dollar amount is referred to as "simple interest." Lastly, Net present value can be defined as the difference between the PV of cash inflows and the present value of cash outflows. Net present value is used in capital budgets to assess the probability of a project. The net present value is a standard affirming that a project should be established. Example: If a bank pays 5% interest on a $100 deposit today, in one year, this $100 will be worth $105. This is expressed by the following equation: F1= p (1+r). F1 is the balance at the end of the period, p represents the amount of invested, and r represents the rate of interest. For example, the future of $1,000 compounded at 10%, would be $1,100 after one year and $ 1,331 after three years of investing. For example, if the interest rate is 10%, then the present value of $500 earned or spent in one year from now is $500 divided by 1.10, equates to $455. This example demonstrates the overall notion that the present value of a future amount is less than the actual future amount. Summary Present and future values are important methods for any financial decision. An investment can be viewed in two methods. We discussed present and future values in this video. The process of finding the present value of future cash flows is referred as discounting. Discounting future value to present value is a common technique, especially when weighing in on capital budget decisions. Have the knowledge of the calculations will allow individuals to calculate almost any investment decision
Views: 105921 Lisa Dumont
A video that explains discount factors and net present value calculations (NPV). Includes cost of capital, time value of money, risk, inflation. Buy my book here: Buy the book here: http://www.lulu.com/shop/bryan-mills/financial-management-made-manageable/paperback/product-23253099.html
Views: 130836 Bryan Mills
Subscribe to Alanis Business Academy on YouTube for updates on the latest videos: https://www.youtube.com/alanisbusinessacademy?sub_confirmation=1 Net Present Value, commonly referred to as NPV, is a capital budgeting tool used in corporate finance and is designed to help firms assess the financial feasibility of various capital expenditures. Based largely on the time value of money, NPV compares the value of the initial investment to the cash flow generated over a number of years. An NPV greater than 0 supports the acceptance of the project, while an NPV less than 0 supports the rejection of the project. Over the course of this video we'll walk through how to calculate NPV using the present value formula. Although the process is rather simple once you understand the basics, calculating NPV can be rather time consuming. To ensure accuracy make sure that you are organized when writing out your calculations as one number can certainly affect your results.
Views: 197820 Alanis Business Academy
OK, this is a very rough cut with a few "modest" mistakes but should still get the basic concept across for discount rates. This is a key principle in most any form of investing and especially in real estate. When determining a net present value (NPV) you must select a discount rate. This video helps explain how the discount rate works and why today's value is less if you set a higher discount rate.
Views: 98008 SpaceOverTime
Do you have a saving goal? Do you want to know how much to invest each month / year to reach that goal? Excel has a very powerful function - the Future Value (FV) that will give you the answers that you need. In this video, I demonstrate the FV() and PMT() Functions. I also create a one-input Data Table so that we can perform "What-If" Analysis - what if my Interest Rate changes? I invite you to visit my website - www.thecompanyrocks.com/excels - to view all of my Excel Video Lessons
Views: 33987 Danny Rocks
Net Present Value or NPV concept & calculation method in Excel explained in Hindi. NPV is an important valuation metric to evaluate a project, business, franchise or an investment opportunity. It is also used in Discounted Cash Flow method to value a company. It is used along with IRR (Internal Rate of Return) to evaluate an investment. Net Present Value is based on the concept of Time Value of Money where we calculate the present value of future cash flows (future value). Related Videos: Internal Rate of Return (IRR) - https://youtu.be/x6eXfx2Tv-w Time Value of Money - https://youtu.be/Pazp1b2LhAQ Present Value - https://youtu.be/pxm-5MBO2dg Present Value of an Annuity - https://youtu.be/0giLqLyijtc एक्सेल में नेट प्रेजेंट वैल्यू या एनपीवी का कांसेप्ट और कैलकुलेशन मेथड इस वीडियो में हिंदी में समझिये। एनपीवी किसी प्रोजेक्ट, बुज़ीनेस, फ्रेंचाइज़ी या इन्वेस्टमेंट ओपोर्च्युनिटी की वैल्यूएशन करने के लिए एक महत्वपूर्ण वैल्यूएशन मीट्रिक है। इसे किसी कंपनी की वैल्यूएशन के लिए डिस्काउंटेड कैश फ्लो मेथड में भी उपयोग किया जाता है। किसी इन्वेस्टमेंट का वैल्यूएशन करने के लिए इसका उपयोग आईआरआर (Internal Rate of Return) के साथ किया जाता है। नेट प्रेजेंट वैल्यू टाइम वैल्यू ऑफ़ मनी के कांसेप्ट पर आधारित है जहां हम फ्यूचर कॅश फ्लो (फ्यूचर वैल्यू) के प्रेजेंट वैल्यू की गणना करते हैं। Share this Video: https://youtu.be/SpHIBfPGwx8 Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is net present value? What is the purpose of net present value? Why net present value calculation is used? How to calculate net present value? What is the calculation formula for net present value? What is the method of NPV calculation? How to evaluate a project, business, franchise or an investment opportunity with net present value method? What is discounted cash flow method? What is DCF and IRR (Internal Rate of Return) and how they are used? What is terminal cash flow? How net present value is calculated for a project, business or franchise? How net present valuation method is used to evaluate an investment opportunity? What is discount rate? How to evaluate the value of a company? What is the valuation method for projects, business, company, franchise and investment opportunity? How to calculate net present value in a Microsoft Excel sheet or Google spreadsheet? How to evaluate the net present value of any investment? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Instagram - http://instagram.com/assetyogi Twitter - http://twitter.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Facebook – https://www.facebook.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Google Plus – https://plus.google.com/+assetyogi-ay Hope you liked this video in Hindi on “Net Present Value (NPV)”.
Views: 49999 Asset Yogi
http://alphabench.com/data/excel-npv-irr-tutorial.html Tutorial demonstrating how to calculate NPV, IRR, and ROI for an investment. Demonstrates manual calculation of present values as well as the use of NPV and IRR functions in Excel. The spreadsheet used can be downloaded at: http://alphabench.com/data/NPV-IRR_STR.xlsx Capital Budgeting includes the analysis of various projects with financial measurements such as Net Present Value (NPV), Internal Rate of Return (IRR) and Return on Investment (ROI). This video discusses all of these concepts briefly while demonstrating the calculation of them using Excel. Excel Functions: NPV IRR
Views: 47019 Matt Macarty
What happens when we have multiple periods of different sized cash flows? We discount the cash flows individually using the equation we just learned. Illustrations included to clearly explain the concept like always! Website: http://www.notepirate.com Follow us on Facebook: https://www.facebook.com/pages/Note-Pirate/514933148520001?ref=hl Follow us on Twitter: http://twitter.com/notepirate We appreciate all of the support you guys have given us. Be apart of the mission to help us reach more students by subscribing, thumbs upping and adding the videos to your favorites! ** Notepirate is privately owned and exclusive to Notepirate.com.**
Views: 27910 Notepirate
This video explains how to calculate the present value of a single cash flow. The formula for calculating the present value of a single cash flow is presented and illustrated through examples. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 42111 Edspira
Demonstrates the concept of future value and shows how to use the FV function in Excel 2010 Follow us on twitter: https://twitter.com/codible Some good books on Excel and Finance: Financial Modeling - by Benninga: http://amzn.to/2tByGQ2 Principles of Finance with Excel - by Benninga: http://amzn.to/2uaCyo6
Views: 145544 Codible
In this tutorial, you will learn to calculate Net Present Value, or NPV, in Excel. In this tutorial, you will learn to calculate Net Present Value, or NPV, in Excel. Net Present Value is a financial function that is calculated for an investment, and it represents the present value of the investment minus the amount of money that costs to buy in. Excel offers a preset function for this called NPV. Please be aware that all the investment cash flows must occur at the same interval for the calculation to be accurate. NPV has two arguments: rate -- which refers to the discount rate, and the range of values that contains future cash flows. Step 1: Open the document in which you want to calculate NPV. Step 2. Go to the cell where you want the function to be calculated, and type the following: = npv (our discount rate /12 as the rate is compounded monthly, the range of values you want to be considered)+the initial investment, in our case the starting 100,000$. Step 3. Excel will calculate for you the Net Present Value of this investment. Step 4. Go to the cell that you want to hold the NPV result for comparison, and type: =npv(the same discount rate/12,the range of values)+the initial investment. Hit Enter. Step 5. Excel will calculate for you the Net Present Value of this investment. Step 6. Now that we see both results, we will agree that the first option is better and proceed with it. Result: Congratulations, you have learned how to calculate the Net Present Value in Excel.
Views: 397947 Excel, Word and PowerPoint Tutorials from Howtech
How to Calculate Net Present Value, Annuity & Perpetuity | Corporate Finance Institute Enroll in our full course and earn a certificate to upgrade your career: http://courses.corporatefinanceinstitute.com/courses/financial-math-corporate-finance We explore the concept of the “time value of money”, how to calculate net present values and future values using compounding and discounting techniques. Learn how the present values of annuities, perpetuities, and growing perpetuities can be calculated using NPV and DCF. -- FREE COURSES & CERTIFICATES -- Enroll in our FREE online courses and earn industry-recognized certificates to advance your career: ► Introduction to Corporate Finance: https://courses.corporatefinanceinstitute.com/courses/introduction-to-corporate-finance ► Excel Crash Course: https://courses.corporatefinanceinstitute.com/courses/free-excel-crash-course-for-finance ► Accounting Fundamentals: https://courses.corporatefinanceinstitute.com/courses/learn-accounting-fundamentals-corporate-finance ► Reading Financial Statements: https://courses.corporatefinanceinstitute.com/courses/learn-to-read-financial-statements-free-course ► Fixed Income Fundamentals: https://courses.corporatefinanceinstitute.com/courses/introduction-to-fixed-income -- ABOUT CORPORATE FINANCE INSTITUTE -- CFI is a leading global provider of online financial modeling and valuation courses for financial analysts. Our programs and certifications have been delivered to thousands of individuals at the top universities, investment banks, accounting firms and operating companies in the world. By taking our courses you can expect to learn industry-leading best practices from professional Wall Street trainers. Our courses are extremely practical with step-by-step instructions to help you become a first class financial analyst. Explore CFI courses: https://courses.corporatefinanceinstitute.com/collections -- JOIN US ON SOCIAL MEDIA -- LinkedIn: https://www.linkedin.com/company/corporate-finance-institute-cfi- Facebook: https://www.facebook.com/corporatefinanceinstitute.cfi Instagram: https://www.instagram.com/corporatefinanceinstitute Google+: https://plus.google.com/+Corporatefinanceinstitute-CFI YouTube: https://www.youtube.com/c/Corporatefinanceinstitute-CFI
Views: 12052 Corporate Finance Institute
Premium Course: https://www.teachexcel.com/premium-courses/68/idiot-proof-forms-in-excel?src=youtube Excel Forum: https://www.teachexcel.com/talk/microsoft-office?src=yt Excel Tutorials: https://www.teachexcel.com/src=yt This tutorial shows you how to get the Net Present Value of a project or business venture in the future using excel. You can do this very easily in excel spreadsheets and this will teach you how to do that using the estimated cash flows of a project. The NPV() function is used for the calculations. This is also a basic discounted cash flows example. This includes discount rate and number of periods in order to use the npv function. To follow along with the spreadsheet used in the video and also to get free excel macros, tips, and more video tutorials, go to the site: http://www.TeachMsOffice.com
Views: 268845 TeachExcel
This short video shows you how to do a basic calculation of the NPV of an investment project. Here's a link to the excel sheet used in the solution in this video: https://www.dropbox.com/s/3jtkv2176r7c0ig/NPV%20Calculation.xlsx?dl=0
Views: 4114 Frank Conway
HI Guys, This video will teach you how to calculate NPV (Net Present Value) and Internal Rate of Return (IRR) in Excel. Please go to our website www.i-hate-math.com for more tutorials. http://www.i-hate-math.com Thanks for learning !
Views: 326612 I Hate Math Group, Inc
http://www.subjectmoney.com http://www.subjectmoney.com/articledisplay.php?title=Time%20Value%20of%20Money:%20Present%20Value%20and%20Future%20Value What is future value? Future value is the value that money today will be worth at some point in the future if invested for a return. For example, we have $100 today, and we invest it for 1 year at 10% interest, then in 1 year the Investment will be worth $110. In other words, the future value of $100 invest for 1 year at 10% is $110. This is because we will still own the original $100 and we also earned 10%, an additional $10. In total our $100 investment will be worth $110 in 1 year. The future value formula is shown below. What is present value? Present value is today's value of a future Cash Flow . For example, everyone knows that $100 today is more valuable than $100 in the future, but what about $110, $120 or even $200 in the future. How do we calculate what they are worth today? To calculate the present value of a future cash flow we would need a few pieces of information. We need to know when to expect the cash flow, the value (future value) of the cash flow, and the Discount rate . What is the discount rate? The discount rate is the Opportunity Cost s that you have foregone to receive funds in the future. I know, this may sound confusing but it should eventually click. An easy way to understand the discount rate is to ask yourself this question. What kind of investment returns are available to me? If I had $100,000 today, what would the return be on my investment one year for today? Whatever that rate is would be your opportunity cost and would therefore be your discount rate. (It can be more complicated that this when comparing risk but this is a simplified lesson.) https://www.youtube.com/user/Subjectmoney https://www.youtube.com/watch?v=XF_3Dt-8OPE http://www.roofstampa.com hjttp://roofstampa.com http:/www.subjectmoney.com http://www.excelfornoobs.com
Views: 56825 Subjectmoney
Omg I'm SHOCKED how easy.. http://www.MBAbullshit.com or https://www.youtube.com/MBAbullshitDotCom (Slower original video here = https://www.youtube.com/watch?v=GJMad7KTpaw) Hi guys! Here's a super dooper easy video on Net Present Value. You will be shocked, guarantee it. Alright, so if I speak too fast, you can watch my original slower video. Just open this same video on You Tube and click the link in the description in You Tube. Alright, so I'd like to start with the word Net. What do we mean by Net? Well it's usually the result of different amounts combined. So for example if you're at a restaurant. And you order food for $100. That's expensive. And the discount is $15. So you'd be paying $85 Net. The word Net means it's simply a combination of the $100 and the negative $15 combined. So this becomes net. So how do we apply that in business? Well let's say that you paid $100 today to your friend and your friend would give you back $105 one year later. So this is negative. That's why it's red and this is positive that's why it's green. It's negative because you're paying it. This is positive because you're getting it. Alright, so in this case we can say that we have a Net Value of positive $5. Why? Because positive 105, negative 100, we get $5. So does this look like a good deal to you or not? I think it does look like a good deal. Think about it. You're getting 100 bucks, you're getting back the 105. You gain 5. It seems like a good deal, doesn't it? However in this case we're only talking about the net value. It's much better to think about the net present value. So present means today. So we have to think about the value of this $105 today, because $105 next year is not worth $105 today. Why? Because we have to think about the time value of money. What does the time value of money mean? It means that money given to you today is worth more than money given to you tomorrow. And it’s worth much more than money given to you next year. Why? Because,for example, if a bank was giving a 6% interest rate… I know that's high, just an example… Then instead of giving your money, your $100 to your friend and getting back $105 next year, you could instead decide to deposit your $100 into the bank. Next year how much would that be? Would it be $105, would it be $100? No it would probably be $100 plus 6%. It would probably be $106. So that's what we mean by the time value of money. So with the net present value formula, which is different from simply net value. The net present value formula, we take into consideration the time value of money and we take into consideration how much interest you would have earned, if you put your money in the bank instead of giving your money to your friend or depositing your money in your business or whatever or investing your money in your business or whatever options you have. Okay, so now how do we create the net present value formula? Very simple. In this case step one is, boom, what is this? Why is this 105, and this one is 105 plus all this scary mumbo jumbo? Don't worry it's not scary at all. The 105 here represents the $105. The .06 here represents the 6% interest rate that you would have earned if you put your money in the bank instead of depositing it with your friend and getting back money from your friend. Subscribe to MBAbullshit.com and my other finance videos at http://www.youtube.com/subscription_center?add_user=mbabullshitdotcom Net Present Value Explained with NPV Calculation & Net Present Value Example
Views: 62452 MBAbullshitDotCom
This Excel tutorial shows how to calculate the net present value (NPV) of an investment. Watch more at http://www.lynda.com/Excel-2010-tutorials/Financial-Functions-in-Depth/83199-2.html?utm_medium=viral&utm_source=youtube&utm_campaign=videoupload-83199-0304 This specific tutorial is just a single movie from chapter three of the Excel 2010: Financial Functions in Depth course presented by lynda.com author Curt Frye. The complete Excel 2010: Financial Functions in Depth course has a total duration of 2 hours and 20 minutes, and explores dozens of functions for evaluating cash flows, calculating depreciation, determining rates of return, and much more Excel 2010: Financial Functions in Depth table of contents: Introduction 1. Analyzing Loans, Payments, and Interest 2. Calculating Depreciation 3. Determining Values and Rates of Return 4. Calculating Bond Coupon Dates and Security Durations 5. Calculating Security Prices and Yields 6. Calculating Prices and Yields of Securities with Odd Periods Conclusion
Views: 120427 LinkedIn Learning
This video shows how to calculate the present value (PV) of stream of mixed cash flows using Texas Instruments BAII Plus financial calculator
Views: 16060 The Finance Classroom
Discount Rate calculation and formula for NPV is explained in hindi. How to select the right discounting rate while calculating NPV of a project, business or investment? Selecting right discount rate is also important for calculating Payback Period and Profitability Index and in all other Capital Budgeting techniques. It is one of the most important factors in company valuations while doing valuation using Discounted Cash Flow or DCF method. Related Videos: NPV (Net Present Value): https://youtu.be/SpHIBfPGwx8 IRR (Internal Rate of Return): https://youtu.be/x6eXfx2Tv-w NPV vs IRR: https://youtu.be/kUV9xE2B7KU Payback Period - https://youtu.be/8MnGVL_3QuI Profitability Index - https://youtu.be/7CCKn_eixZ0 Time Value of Money - https://youtu.be/Pazp1b2LhAQ इस वीडियो में डिस्काउंट रेट कैलकुलेशन और NPV के फार्मूला को हिंदी में एक्सप्लेन किया गया है। किसी प्रोजेक्ट, बिज़नेस या इन्वेस्टमेंट की NPV कैलकुलेट करते समय सही डिस्काउंट रेट कैसे चुने? सही डिस्काउंट रेट का चयन करना पेबैक पीरियड प्रोफिटेबिलिटी इंडेक्स और सभी दूसरे कैपिटल बजटिंग टेक्निक्स के भी बहुत महत्वपूर्ण है। यह किसी कंपनी की वैल्यूएशन करने में सबसे महत्वपूर्ण कारको में से एक होता है जब डिस्काउंटेड कैश फ्लो या डीसीएफ विधि का उपयोग करके वैल्यूएशन किया जा रहा हो। Share this Video: https://youtu.be/XqqD1d713W8 Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is discount rate? Why discount rate is important in company valuation? How to calculate NPV using discount rate? Why discount rate is important in NPV calculation and other capital budgeting techniques? Why is it important to take correct discounting rate while using capital budgeting techniques for evaluation? How is discount rate different from interest rate? How to use discount rate calculation for evaluating any project or investment? What is discount rate formula? How to do NPV and IRR calculation using discount rate? What is the company valuation method? Why discount rate is important while evaluating a company using discounted cash flow or DCF method? How selecting right or wrong discount rate affects the payback period and profitability index calculation? What is the discount rate calculation formula for NPV? How to select the discount rate while evaluating a project, business or investment? What are the most important factors in company valuation and investment return calculation? How to use Microsoft excel sheet for evaluation of a project, business or investment? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Pinterest - http://pinterest.com/assetyogi/ Instagram - http://instagram.com/assetyogi Facebook – https://www.facebook.com/assetyogi Google Plus – https://plus.google.com/+assetyogi-ay Twitter - http://twitter.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Hope you liked this video in Hindi on “Discount Rate - Calculation & Formula for NPV”.
Views: 7841 Asset Yogi
Net Present Value and Internal Rate of Return, in short NPV and IRR. What is the purpose of the NPV and IRR methods of investment analysis, and how do you calculate NPV and IRR? The main idea of Net Present Value is very simple: time is money! The net present value (or “discounted cash flow”) method takes the time value of money into account, by: - Translating all future cash flows into today’s money - Adding up today’s investment and the present values of all future cash flows If the net present value of a project is positive, then it is worth pursuing, as it creates value for the company. IRR is the discount rate at which the net present value becomes 0. In other words, you solve for IRR by setting NPV at 0. Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Philip delivers #financetraining in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Views: 19061 The Finance Storyteller
Visit http://www.TeachExcel.com for more, including Excel Consulting, Macros, and Tutorials. This Excel Video Tutorial goes through 3 Present Value problems and shows you how to solve them using the PV() function in Excel. You will learn some of the basic applications for the present value function and also the different uses for this function. The three examples include how to figure out what a future amount is worth today; valuing annuity payments in the future for today; and how to value an asset with the present value function. This is a great tutorial for all of those just learning finance or for people who need to more accurately find the value of and asset or cash flow. For Excel consulting, classes, or to get the spreadsheet or macro used here visit the website http://www.TeachExcel.com There, you can also get more free Excel video tutorials, macros, tips, and a forum for Excel. Have a great day!
Views: 75764 TeachExcel
This video shows how to determine how long it takes (the number of time periods (N)) to achieve a future value (FV) given a certain present value (PV) and interest rate (R) using Texas Instruments BAII Plus financial calculator
Views: 8042 The Finance Classroom
This video explains what a perpetuity is and how to calculate its present value using a formula. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 88568 Edspira
Present Value of an Annuity excel formula, calculation and concept explained in hindi with examples. How to calculate Present value of annuity in Excel and manually? Eg. you can calculate Present Value of monthly Rent that you get from a lease. Related Videos: Time Value of Money - https://youtu.be/Pazp1b2LhAQ Present Value - https://youtu.be/pxm-5MBO2dg Future Value - https://youtu.be/BFRGWenwulc Future Value of an Annuity - https://youtu.be/f6a7E3326QQ Future Value of Uneven Cash Flows - https://youtu.be/yHoTUk8HP-c Net Present Value (NPV) - https://youtu.be/SpHIBfPGwx8 Internal Rate of Return (IRR) - https://youtu.be/x6eXfx2Tv-w इस हिंदी वीडियो में प्रेज़ेंट वैल्यू ऑफ़ एन्युटी को उदहारण के साथ समझाया गया है। Share this Video: https://youtu.be/0giLqLyijtc Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is the present value of an annuity? How to calculate the present value with an annuity? What is the concept of present value of an annuity? What are the basics of the time value of money? How to calculate the present value of an annuity in Microsoft Excel or Google spreadsheet? What is the calculation formula of the present value of an annuity? What is the meaning of the present value of an annuity? How to calculate the present value of a rental income? How present value of companies are calculated? How to calculate the present value of annuity for any fixed income? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Facebook – https://www.facebook.com/assetyogi Instagram - http://instagram.com/assetyogi Twitter - http://twitter.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Pinterest - http://pinterest.com/assetyogi/ Google Plus – https://plus.google.com/+assetyogi-ay Hope you liked this video in Hindi on “Present Value of an Annuity”.
Views: 13038 Asset Yogi
Stay knowledgeable by subscribing! http://bit.ly/iLiveInTheBayArea Visit my site for even more information: http://www.iLiveInTheBayArea.com Like me on Facebook: http://www.fb.com/iLiveInTheBayArea As I discussed in my "Investing Terms Part 2" video, Net Present Value -- or NPV -- means to convert all the future cash flows into today's dollars. Which even for me is still a bit of a confusing way to understand it. For a quick recap on how we calculate this figure, let's look at a simple example. If you buy a property for $1m, and make $100k/year every year for 5 years, then SELL the property for $1m again at the end of the 5th year, your internal rate of return will be 10%. To explain this simply, you've made 10% on your money every year for the last 5 years since you bought and sold the property with no profit. But what is your Net Present Value? Well, you're NPV can only be determined by you as an investor. As an investor, you need to have an idea of what kind of return you are ok with making. For example, if you place your money in a savings account, you know that tomorrow, next year and even in 10 years your money is going to be there. Even if the bank closes, so long as you have under $250,000 in your account the federal government will guarantee that your money is safe. Because of the safety factor the bank in return pays you a very, very small return rate. Usually half or a quarter of a percent. Because of the lack of risk and the extreme safety of your money, you're NPV is under 1%. Safety is your goal. If you willing to go into a decaying market where unemployment is extremely high and the populating is shrinking, you may be demanding a higher NPV. If you're looking into investing in a strong market where there is low unemployment and the population is growing, you may demand a lower NPV. Let's look at a real life example in my market area. San Francisco is currently -- and almost always -- considered one of the top investment locations in the US along with New York, LA and other large metro areas. Because many people view it as a stable investment, they're willing to accept less of a return, typically in the 3-6% range. Right outside of San Francisco are some pretty stable locations which aren't considered as great as San Francisco but are fairly close to investment value. In locations such as Berkeley and Downtown Oakland your average return range may be 5-9%. Once you start venturing out further and further away from the main business hub the rates start to increase depending on a variety of factors. For example, if you take a location with a higher than normal crime rate and higher unemployment you will likely see return rates of over 15%. However, if you take another location that is the same distance from San Francisco but is a high income area with low unemployment you will likely see return rates in the range of 8-12%. If you go to a city where there is only one major employer who is about to go bankrupt and could very likely close their factory doors, then return rates would be much much higher than 15% due to the extreme risk. Which again brings us to the point of you as an investor knowing what your desired return rate is. Let's go back to the same $1m property example. Let's say you are interested in the particular property, but because you think some tenants might leave you don't want to make 10%, you instead demand 12%. Using the same $1M property example above, if you plan on selling this property in 5 years for the same $1m you purchased it for, you would have to pay $72,000 LESS than $1m to attain your 12% Internal rate of return. But presume there's a bidding war, and you feel this property is under priced just to draw in your offer. Instead of 10%, you're perfectly comfortable with 8%. Again you using our example you could pay about $80,000 MORE than the $1m list price and still make your 8% return rate. Determining your NPV isn't the easiest thing in the world. Nor is it the easiest concept to understand. However, don't confuse the fact that it is a bit tricky to understand with the fact that it is one of the most sought after methods by investors in determining what a property is worth to them...now that's good to know.
Views: 16123 Davide Pio - CCIM, LEED AP
http://www.subjectmoney.com This Time Value of Money Lesson TVM covers all the basic concepts of the Time Value of Money that you would learn in Finance. In this tvm tutorial we cover simple interest, compound interest, present value formula, future value formula, annuity due, ordinary annuity, present value of annuities, future value of an annuity, intrayear compounding interest, and perpetuities. In this time value of money lesson we teach you by video using visualizations to help you understand how money and time works. If you study this finance tvm video tutorial in combination with what you leanr about the time value of money in your finance class, you should have a clear understanding when it is time to take your time value of money tvm test or exam. I’m glad that I could help you study for your finance time value of money exam. What is simple interest? What is compound interest? What is an ordinary annuity? What is an annuity due? What is the present value formula? What is the future value formula? How to solve the present value of an uneven series of cash flows. What is a perpetuity? How to solve the present value of an ordinary annuity. How to solve the present value of an annuity due. How to solve the future value of an annuity due. How to solve the future value of an ordinary annuity. Present value of a perpetuity formula. Time value of money, time value of money lesson, tvm, tvm lesson, tvm formulas, time value of money formulas, present value formula, future value formula, present value, future value, annuity due, ordinary annuity, simple interest, compounding interest, intrayear compounding interest, perpetuity, present value of a perpetuity, how to present value, what is present value, what is time value of money
Views: 190200 Subjectmoney