Difference between present value and future value

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Time Value of Money and Investment.

  1. What's the difference between Present Value and Future Value?
  2. Compare the future value after 5 years of $15,000 invested and earning straight annual interest of 6% vs. the future value of $15,000 invested for 5 years at 6% compounded quarterly. What accounts for the difference?
  3. What is "opportunity cost" and what does it refer to in describing an investment decision? Give an example.
  4. What are the three different methods an organization might use to evaluate large dollar, multi-year investment decisions? What are the strengths and limitations of each method?

Reference no: EM131549926

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