What is present time value of money?


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Present value:

Many times, investors like to know the present value which grows to a given future value. Suppose, you want to save some money from your salary to buy a scooter after 5 years. You should know how much money should be put into bank now in order to get the future value after 5 years. The present value is simply the inverse of compounding used in determining future value.


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