TVM and Financial Decisions: Part III
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The Time Value of Money (TVM) concept is a foundation of finance. The concept of time value of money suggests that the money received at different points of time has different value than that of today. Simply stated, $1 one year from now is less than a $1 in hand today. With an understanding of TVM's influence on cash flows, you will realize how a financial manager creates shareholder wealth (profits) by properly applying TVMs impact on capital budgeting financing. Please note two important items, capital is a typical reference to cash and the specific mention of the ability to learn to use a financial calculator. The proper use of a financial calculator is a valuable and transferable skill that can apply to personal budgeting
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