Basic financial concepts Basic financial concepts The Adjusted Present Value (APV) is the Net present value (NPV) of a project if financed solely by ownership equity plus the present value (PV) of any financing benefits (the additional effects of debt). ...more on Wikipedia about "Adjusted present value"
:For other uses of Amortization, see the Amortization disambiguation page. ...more on Wikipedia about "Amortization (business)"
An amortization calculator is used to determine the periodic payment amount due on a loan (typically a mortgage), based on the amortization process. ...more on Wikipedia about "Amortization calculator"
An amortization schedule is a table detailing each periodic payment on a loan (typically a mortgage), as generated by an amortization calculator. Amortization schedules are calculated so that each periodic payment for the entirety of the loan is equal, making the repayment process somewhat simpler under amortization than with other models. ...more on Wikipedia about "Amortization schedule"
Collateral is a word used for assets that secure a debt obligation. For example, in the case of a mortgage the house serves as the collateral for the mortgage loan. This way, the bank is secured against the default risk of the borrower not being able to meet the interest payments. In case of default the bank can sell the house and get its money (or at least a part of it) back. ...more on Wikipedia about "Collateral (finance)"
In finance, discounting is the process of finding the current value of an amount of cash at some future date, and along with compounding cash form the basis of time value of money calculations. The discounted value of a cash flow is determined by reducing its value by the appropriate discount rate for each unit of time between the time when the cashflow is to be valued to the time of the cash flow. Most often the discount rate is expressed as an annual rate. ...more on Wikipedia about "Discount"
In finance, a discounted cash flow or DCF is the value of a cash flow adjusted for the time value of money. The nominal values of two cash flows in different time periods cannot be directly compared because the preference of most people for consumption sooner rather than later, and because of the opportunity cost of forgoing an interest earning investment. Establishing which interest rate or discount rate to use can sometimes prove to be a very complicated task. ...more on Wikipedia about "Discounted cash flow"
A financial transaction involves a change in the status of the finances of two or more businesses or individuals. ...more on Wikipedia about "Financial transaction"
Future value measures what money is worth at a specified time in the future assuming a certain interest rate. This is used in time value of money calculations. ...more on Wikipedia about "Future value"
Future-oriented is a term used in finance and economics to describe agents that discount the future lightly and so have a low discount rate, or equivalently a high discount factor. ...more on Wikipedia about "Future-oriented"
In finance, interest has three general definitions. ...more on Wikipedia about "Interest (finance)"
Maturity refers to the final payment date of a loan or other financial instrument, after which point no further interest or principal need be paid. ...more on Wikipedia about "Maturity (finance)"
Net present value is a valuation method based on discounted cash flows. NPV is calculated by discounting of a series of future cash flows, and summing the discounted amounts and the initial investment (a negative amount). It is a time consuming process, but not difficult at all. ...more on Wikipedia about "Net present value"
Participation may mean sharing something in common with others. ...more on Wikipedia about "Participation (ownership)"
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The present value of a future cash flow is the nominal amount of money to change hands at some future date, discounted to account for the time value of money. A given amount of money is always more valuable sooner than later since this enables one to take advantage of investment opportunities. Because of this present values are smaller than corresponding future values. ...more on Wikipedia about "Present value"
:For other meanings of the term Terminal value, see the Terminal value disambiguation page. ...more on Wikipedia about "Terminal value (finance)"
The time value of money (TVM) or the discounted present value is one of the basic concepts of finance, developed by Leonardo Fibonacci in 1202. ...more on Wikipedia about "Time value of money"
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