Explain the importance of a time line

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Questions -

Q1. Explain the phrase "a dollar today is worth more than a dollar tomorrow."

Q2. Explain the importance of a time line.

Q3. What are the two factors to be considered in time value of money?

Q4. Explain the difference between future value and present value.

Q5. Explain the difference between compounding and discounting.

Q6. Explain how compound interest differs from simple interest.

Q7. If you were given a choice between investing in a savings account that paid quarterly interest and one that paid monthly interest, which one should you choose if they both offered the same stated interest rate and why?

Q8. Compound growth is exponential over time. Explain.

Q9. What is the Rule of 72?

Q10. You are planning to take a spring break trip to Cancun your senior year. The trip is exactly two years away, but you want to be prepared and have enough money when the time comes. Explain how you would determine the amount of money you will have to save in order to pay for the trip.

Reference no: EM133186357

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