| Present Value - PV | |
 The amount that a future sum of money is worth today given a specified rate of return. |
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 This sounds a bit confusing, but it really isn't. An investment that earns 10% per year and can be redeemed for $1000 in five years would have a present value of $620. In other words, $620 today is worth $1000 in five years. |
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 Understanding The Time Value Of Money - Find out why time really is money by learning to calculate present and future value. |
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Related Terms
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