FINC1231 - CH.9

= i

• periodic

• nominal

= j

• periodic

• nominal

per month

per year

per semiannual period

per day

• periodic

• nominal

compounded monthly, semi annually, daily, quotes, stated, APR (annual percentage rate)

• periodic

• nominal

n = number of _ * m

difference between the known future value and the computed present value (principal)

amounts of money have different values at difference times (_)

Equivalent values: to make such sums of money comparable, a point in time _ must be chosen for the comparison

If the focal date for the payment falls AFTER the due

date, use the

• FV formula

• PV formula

If the focal date for the payment falls BEFORE the due

date, use the

• FV formula

• PV formula