MoneyKraft

1. A rupee earned 10 years ago can be compared with a rupee earned today by

Multiplying past earnings by number of compounding years

Calculating discounted value of past earnings

Calculating future value of past earnings

2. Mr.A has Rs. 1 lakh of savings just kept in cash in a safe. After 5 years of high inflation, the value of that sum will be

Much more than Rs.1 lakh

The same, because it has remained untouched in the safe

Much lesser than Rs.1 lakh

3. The value of money has reduced between 50 years ago and now because

The exchange rate has lost value

People spend much more nowadays

Prices of all goods and services have increased

Time value of money - future value (inflation)

watch this video to understand why grandpa's breakfast costed less than yours.

Time value of money is a useful concept with several applications. Learn how to look at yesterday's money for its value today.

AUTHOR(s):Uma Shashikant

COMMENT :

No Comments found