Internal Rate of Return - (IRR)
Internal Rate of Return The internal rate of return is the rate of return at which the value of NPV is 0.
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Functions of Banks
Bank The bank is a financial institution that keeping, lending and exchanging of money.It collects surplus of money of the people in the form of deposits and gives it to others in the form of loans.It is called lifeblood of money. According to W. Hock, "The bank is a financial institution which creates money with money." From the above of the discussion, we can determine the following features of the bank: ü Bank is a financial institution. ü It is the trader of money and loan. ü It collects money from people in the form of deposits. ü It gives money in the form of the loan. ü The source of profit of bank is interest. Functions of bank There are two types of function of the bank.These are- 1) Primary Functions 2) Secondary Functions Primary Functions of Bank The primary function of a bank also known as banking functions.They are the main fun
Introduction of Capital Budgeting, PBP and NPV
Capital Budgeting Capital budgeting is the process that businesses use to determine the merits of investment projects.
Future Value Versus Present Value and Comparison of Annuity(TVM)
Future Value Versus Present Value Assume that you have an opportunity to spend $10,000 today on some investment that will produce $15,000 spread out over the next 4 years as follows:
Annuity and Types of Annuity - (TVM)
Annuity An annuity is a stream of equal periodic cash flows over a specified time period. These cash flows can be inflows of returns earned on investments or outflows of funds invested to earn future returns. Simply, we can say an Annuity is a series of payments made at equal intervals.
Introduction and Basic Time Value of Money Formula - (TVM)
Time Value of Money The time value of money refers to that there are greater benefits to receive money sooner than later. Money that you have in hand today can be invested in earn a positive rate of return, producing more money in tomorrow. Because of that, a dollar is worth more than a dollar in the future.