Chapter 12 – Introduction
This chapter is remixed from “Accounting Principles: A Business Perspective”, BC Campus and is licensed under CC BY 4.0
Rent, Interest, and Profit
In this lesson, you will learn how to:
- define interest and explain how interest rates vary based on risk, maturity, loan size, and taxability
- explain how interest rates relate to the time value of money.
- explain how a firm uses “future value” and “present value” to evaluate buying and selling decisions over different time periods
- Calculate present and future values through compounding and discounting
