Investment Fundamentals

Present Value

Definition

What is Present Value?

The current worth of money expected in the future after applying a discount rate.

Example in practice

At a 10% discount rate, ₦110,000 due in one year has a present value of ₦100,000.

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The original amount of money invested or lent, excluding later returns.

Money or other resources committed to produce income, growth, or another economic benefit.

An asset or commitment of money made with the expectation of future income, growth, or both.

Anything with economic value that can be owned or controlled.

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