1. ARTICLE:
TITLE
Time value of money and investment analysis
BY
Bruce J. Sherrick, Paul N. Ellinger, David A. Lins
CONCEPT:
This article is about the importance of time value of money. The researchers focus on
the concept of time value of money and problems related in measuring TMV. The
researchers also give the solution of the problem in measuring TMV. By adopting these
changes the TMV will measure correctly and help us in mitigating risk associated with
calculating future value of a bond, stock and investment. The researcher divide problem
associated with TMV in 3 main categories. First the direction in time that cash flows are
converted to equivalent values, second cash flows are single or repeated series, and
last the decision variables are unknown value of the problem. The problem will be
removed in two phases first identifying the type of problem exists and secondly correctly
applying the mathematical calculation.
EXPLANATION:
This article represents the importance of time value of value and problem associated
with measuring TMV. First we have to define TMV. TMV represent the constraint
associated with the value of money. With the passage of time the value of money either
decrease or increase so we have to adjust this fluctuation to keep the investor
investment on the safe side. This adjustment is actually the concept of time value of
money. The value of money fluctuates because of inflation, risk, human preferences in
spending money and opportunity cost associated with investing money.
The researcher divide the problem associated with calculating TMV into 3 main
categories, first the direction in time that cash flows are converted to equivalent values,
second cash flows are single or repeated series, and last the decision variables are
unknown value of the problem.

2. The problems are labeled as, single payment & uniform series compounded amount,
sinking fund deposit, single & uniform series present value, capital recovery or loan
amortization. The problem associated with TMV will be removed in two phases.
1) Identifying the problem correctly
2) Applying the correct mathematical calculation
CONCLUSION
This article help us in finding the time value of money with better adjustment of value of
money. The problems associated with the TMV could be mitigate by adopting the
change in the formulas of TMV as described in this article. So it will help us to find a
better adjusted future or present value of money. It is also mentioned that drawing
timeline associated with the cashflows are also helpful in finding the problem.
In a nutshell this article helps:
The user in understanding the reasons to
utilize the TMV approaches.
The user in understanding the problem
associated with measuring TMV.
Able the user to categorize the problem
correctly.
The user in understanding the background
and derivation formula used in TMV.
Able the user to apply the correct
technique to solve the TMV.