Finance Ch4

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How does Compound Interest work
FV=
1 of 8
How do you calculate FV when investment is compounded m times a year for T years at an APR of r
FV =
2 of 8
How do you calculate FV from Continuous Compounding
FV =
3 of 8
What is a perpetuity
Constant stream of CF forever, PV=C/r
4 of 8
What is a growing perpetuity
Growing stream of CF forever, PV=C/r-g
5 of 8
What is an annuity
constant stream of CF until maturity, PV=
6 of 8
What is a growing annuity
growing stream of CF until maturity, PV=
7 of 8
Why is a firms worth tricky to determine
Tricky to determine size, time and risk of cashflows
8 of 8

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Card 2

Front

How do you calculate FV when investment is compounded m times a year for T years at an APR of r

Back

FV =

Card 3

Front

How do you calculate FV from Continuous Compounding

Back

Preview of the front of card 3

Card 4

Front

What is a perpetuity

Back

Preview of the front of card 4

Card 5

Front

What is a growing perpetuity

Back

Preview of the front of card 5
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