Kaivalyam

Time Value of Money (TVM) is the concept where investors prefer the idea of receiving money now than in the future. For example, if you are given the option of choosing to receive $1000 today or $1000 after 2 years, it is better to choose receiving $1000 today because it has more value and utility. The money can be used to re-invest and gain interest. TVM can be broken down to Present value (PV) and Future Value (FV).  Present Vale and Future Value Present value helps us understand how much the cash that will be received in future is worth today. Future value helps us determine how much the cash received today is worth in future. Both PV and FV can be determined with the help of formulas below. PV = FV / (1+ r)^ t  FV = PV * (1 + r) ^t  where, FV = Future value of money PV = Present value of money r = interest rate t = number of years Conclusion Just as the phrase “time is money”, the value of the money that we have today wil...

Statistics in Business I really wonder why I hated numbers and math as a child. Probably it required me to think or because it was cool to be part of “math hating” group in school or because I never liked my math teachers. Although I always said I hate math, in reality, I am closer to it than I thought. Like my Professor Dr. Karri said, “you can’t do MBA and hate numbers! Ain’t business all about numbers?” Also, I have master’s in pharmacy with a pharmaceutics major. Ain’t pharmaceutical formulations all about math? Whatever is the case, I am sad that I missed to see the value of math earlier in my life. But, I do believe that there are ways to improve it. The more I know about math, the more interesting it is. All business decisions such as measuring performance, forecasting future, understanding risks and ROIs, researching market data etc., are all made easy with the help of statistics. With the knowledge of statistics, we can learn to logically manage and analyze data. Wh...