Present Value – Present value of income is the measurement
of cash that money which you would like to invested today to earn more money or
particular amount for a set a particular age. With the help of the interest
rate, your requirement total amount and total number of installment. In simple
words present value is like decide how much you would like to invest today if
you want to regular weekly payments of $400 for the next particular 5 years.
Future Value – Future value of your income speaks to the
measurement of cash that will be gathered by making fix assumption over a
particular age, in simple words future values is like calculate the correct of
an assumption account, including investment development, subsequent to making
month to month $1,000 commitments for a long time. The formula for future value
is it will give you an approximation amount on the basis of how much you will expansion
on the base of interest percentage.
(A) Total revenue = Total price * total
20*5000 = 1,00,000
(B) Accounting Profits = total number of
revenue – total accounting costs
– 25,000 = 75000
(C) Economic Profits = Total number of revenue
– (Total Accounting costs + total opportunity costs)
= 1,00,000 – (25,000 + 60,000)
= 1,00,000 – 85,000
to me correct worth replicated by the economic profits therefore economic
profits reflect the best use of her time.