When planning for retirement, you need to account for the value of any annuities that you own. Trouble is, there’s not just one value of an annuity—there are two: present value and future ...

To calculate the present value of any cash flow, you need the following formula: Present value = expected cash flow ÷ (1 + discount rate)^number of periods. Year one.

If we were to value this bond at a 4% discount rate, the present value would jump to $12,500 (PV = $500 ÷ 0.04). If we valued it with a 10% discount rate, the present value would fall to $5,000 ...

Net present value (NPV) represents the difference between the present value of cash inflows and outflows over a set time period. Knowing how to calculate net present value can be useful when ...

After adding up all 11 cash flows from the initial -$100 outlay to the 10th year's present value of $9.26, we arrive at a net present value of the project of $34.20. The NPV is positive, so we ...

In the case of a T-bill, we know our purchase price, or present value, its face value or future value, and how long until it matures. For short-term Treasuries, this duration could be 30 to 182 ...

We calculate that the present value of the free cash flows is $326. Thus, if you were to sell this business based on its expected cash flows and a 10% discount rate, $326.00 would be a very fair ...