What Is Your Understanding of the Following Concepts; Present Value, Present Value of an Annuity, Future Value, and Future Value of an Annuity. (Please Describe Any Formulas Related to Each.)

endue Value is the current worth of a future sum of money or stream of gold flows given a specified come out of return. future(a) cash flows are caned at the discount rate, and the high(prenominal) the discount rate, the lower the present regard as of the future cash flows. Determining the appropriate discount rate is the key to properly valuing future cash flows, whether they be earnings or obligations.Present Value of rente is a series of equal payments or receipts that occur at evenly spaced intervals. Leases and letting payments are examples. The payments or receipts occur at the end of each period for an ordinary rente while they occur at the beginning of each period For an annuity due. PVoa = PMT (1 (1 / (1 + i)n)) / i Future Value is the value of an asset or cash at a specified date in the future that is similar in value to a specified sum today.There are two ways to organize FV For an asset with simple annual interest = Original Investment x (1+ interest rate * m inute of years)) 2) For an asset with interest compounded annually = Original Investment x ((1+interest rate)number of years) Future value of annuity is the value of a group of payments at a specified date in the future. These payments are known as an annuity, or set of cash flows.The future value of an annuity measures how overmuch you would have in the future given a specified rate of return or discount rate. The future cash flows of the annuity grow at the discount rate and the higher the discount rate, the higher the future value of the annuity. The current value of a set of cash flows in the future, given a specified rate of return or discount rate. The future cash flows of the annuity are discounted at the discount rate, and the higher the discount rate, the lower the present value of the annuity.