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Products, services, customers, geography
Products, services, customers, geography

A Problem With the Pure Time Preference Theory of Interest:
A Problem With the Pure Time Preference Theory of Interest:

... remain the same, day after day), the spot and forward prices are the same for any commodity. For example, if the spot price of wheat is $10 per bushel, then someone who locks himself into buying 100 bushels of wheat in twelve months’ time will also lock himself into paying (at that time) $10 per bus ...
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... • Real estate is a useful linkage to land use theory and actual land usage. • Demand for real estate (use of space) comes from occupiers of space. They are willing to rent the use of space. • For firms, space is a factor of production. • For households space is a commodity • Supply of real estate co ...
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... at beating competitors (cash or bulk discounts, price cuts, etc.), or for other reasons (special offers for disadvantaged groups, etc.). Lastly, it may be due to consumer initiative, such as when consumers are willing to pay higher prices for fair-trade products. All of the above shows that the noti ...
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Comparison of efficiency and costs of payments: Some new

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Present value

In economics, present value, also known as present discounted value, is the value of an expected income stream determined as of the date of valuation. The present value is always less than or equal to the future value because money has interest-earning potential, a characteristic referred to as the time value of money, except during times of negative interest rates, when the present value will be greater than the future value. Time value can be described with the simplified phrase, “A dollar today is worth more than a dollar tomorrow”. Here, 'worth more' means that its value is greater. A dollar today is worth more than a dollar tomorrow because the dollar can be invested and earn a day's worth of interest, making the total accumulate to a value more than a dollar by tomorrow. Interest can be compared to rent. Just as rent is paid to a landlord by a tenant, without the ownership of the asset being transferred, interest is paid to a lender by a borrower who gains access to the money for a time before paying it back. By letting the borrower have access to the money, the lender has sacrificed the exchange value of this money, and is compensated for it in the form of interest. The initial amount of the borrowed funds (the present value) is less than the total amount of money paid to the lender.Present value calculations, and similarly future value calculations, are used to value loans, mortgages, annuities, sinking funds, perpetuities, bonds, and more. These calculations are used to make comparisons between cash flows that don’t occur at simultaneous times. The idea is much like algebra, where variable units must be consistent in order to compare or carry out addition and subtraction; time dates must be consistent in order to make comparisons between values or carry out simple calculations. When deciding between projects in which to invest, the choice can be made by comparing respective present values of such projects by means of discounting the expected income streams at the corresponding project interest rate, or rate of return. The project with the highest present value, i.e. that is most valuable today, should be chosen.
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