(receipts) as positive. Perform a calculation from the point of view of either the lender (investor) or the borrower, but not both!

(Loan)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money re-

 

 

 

 

 

 

 

 

ceived is a

 

 

Equal periods

 

 

 

positive

 

 

 

 

 

 

 

 

 

 

 

 

 

number

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

2

 

3

 

4

5

PMT

Money paid out

 

 

 

 

 

 

 

 

 

 

 

 

 

is a negative

 

Equal payments

 

 

 

number

 

 

 

 

 

 

 

 

 

(FV is

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Future Value,

 

 

 

 

 

 

 

if any; e.g.

 

 

 

 

 

 

 

a balloon

 

 

 

 

 

 

 

payment)

Figure 5-3. A Cash Flow Diagram for a Loan from Borrower’s

Point of View (End Mode)

1

2

3

4

5

Loan

Figure 5-4. A Cash Flow Diagram for a Loan from Lender’s

Point of View (End Mode)

5: Time Value of Money 65

File name : English-M02-1-040308(Print).doc Print data : 2004/3/9