The Universal Mechanics of Compound Growth

3. The current value of a future payment or sum of money, calculated by discounting the future amount at a specific rate.
8. The cost of passing up the earning potential of a dollar today; it is the fundamental reason money has a time value.
10. A linear representation used by financial analysts to identify the timing and amount of cash inflows and outflows.
12. The interest rate used to bring future cash flows back to the present; it represents the rate of return available on an investment of equal risk.
13. The mathematical term [1/(1+r)^n] used to multiply a future value to find its present value.

1. The mathematical term (1+r)^n used to multiply a present value to find its future value.
2. The key on a financial calculator used to initiate the solving process for an unknown variable.
4. Abbreviation for "Time Value of Money," the concept that the value of a dollar changes over time due to interest and opportunity costs.
5. The situation in which interest is earned on both the initial principal and the interest earned in prior periods.
6. The amount an investment will grow to over a specific period when compounded at a given interest rate.
7. Interest earned only on the initial investment (principal) and not on any previously earned interest.
9. The variable representing the dollar amount of each annuity or equal payment in a series of cash flows.
11. The Excel function variable representing the total number of periods in a TVM calculation.
14. A series of equal payments deposited or received at fixed intervals.