CORE CONCEPTS OF MANAGEMENT
MARKETING MANAGEMENT
FINANCIAL MANAGEMENT
HUMAN RESOURCES MANAGEMENT
OPERATIONS & PRODUCTION MANAGEMENT

Time Value of Money, ‘Risk and Return’
Why is there a ‘ Time Value’ to money? Is it because current consumption is preferred to future consumption? How does one use this principle in the valuation of bonds and securities? How can it be used in fi nancing decisions and capital budgeting? (see FM/AF02). Does it matter in lease or buy decisions? The author - Prof. R Vaidyanathan of IIMB - provides the answers. Future value, annuity, sinking fund factor, present value, loan repayment factor, perpetuity, fl at rates and effective rates are some of the other concepts illustrated. This lesson also elucidates the Theory of Risk and Return. Practical applications are also illustrated. This lesson is fundamental to an appreciation of some of the other lessons under Corporate Finance (FM/AF03, FM/AF06 and FM/AF09).
FM/AF01

26 Mins

40 Mins

75 Pages
Equivalent classroom time: 8hrs