Learn how to calculate present value and discount factors of investment of a firm. Calculation of Present Value: It is a method of assessing the worth of an investment by inverting the compounding process to give present value of future cash flows. This process is called “discounting”. The present value of 'P' of the amount 'A' due at the end [...]
Benchmark rates are rates or the prices of instruments that are traded in the market which are used for pricing of other instruments. These rates or prices are used as benchmark for floating rate instruments. In the fixed income market, it is an interest rate that the market respects and closely watches. Typically a benchmark rate should satisfy the following [...]
The following article will guide to learn how to calculate annuity of cash flows in a company. An annuity is a cash flow, either income or outgoings, involving the same sum in each period. An annuity is the payment or receipt of equal cash flows per period for a specified amount of time. For example, when a company set aside [...]