Case Name :      Developing Financial Insights: Using a Future Value (FV) and a Present Value (PV) Approach

Authors :           Mark E. Haskins

Source :             Darden School of Business

Case ID :           UV5137

Discipline :        Finance

Case Length :    12 pages

Solution Sample availability : YES

Plagiarism : NO (100% Original work)

This case has two aspects. First, it provides a tutorial on the basic concepts associated with straightforward time-value-of-money scenarios. The topics of future value (FV) and present value (PV) are discussed and exemplified for both lump sum and recurring cash flow situations. In this vein, the derivation and use of four useful time-value-of-money reference tables are presented to highlight the underlying logic, connections, and mechanics of determining FVs and PVs. Second, this case provides students with several simple vignettes in which they can apply the foregoing time-value-of-money insights and techniques. The case can be effectively used in degree and nondegree programs, and it requires no additional reading materials. It is well suited for one 90-minute class period, and all or selected subsets of the vignettes contained in it may be assigned. A Teaching Note is available to registered faculty.