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discounting |
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Discounting Calculating the present value of a future amount. Discounting is opposite to compounding. Discounting The act of determining the present value of future cash flows. Because money is subject to inflation and has the ability to earn interest, one dollar today is worth more than one dollar tomorrow. Discounting, then, is the act of determining how much less tomorrow's dollar is worth. For example, a bank may loan a sum of money and schedule repayments at $100 per month for 10 years. The bank may then discount the value of payments and determine exactly how much ? in today's dollars ? it will have received once the loan is paid off. discounting The appraisal method of computing the value of an income-producing property by calculating the present value of anticipated cash flows. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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Discounted by Market discounted cash flow Discounted Cash Flows Discounted dividend model Discounted in/by Market Discounted payback Discounted Payback Period Rule discounting Discounting the News Discrepancy Discrete compounding Discrete random variable Discrete variable Discretion Discretionary Account |
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