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Business math key concepts

Business Math: discuss how the course has affected you in your professional and personal life, as well encouraging academic success.

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I will discuss key business math concepts such as time value of money, present value, opportunity cost etc.
The basic idea of time value of money is that a dollar today is worth more than a dollar tomorrow. (finance professor, 2009) The investor has time preference of money because he can reinvest the funds, which are received early and can earn additional money. Present value, is the future value being discounted by the rate of interest. This concept is important because the major financial objective of the organization "Wealth maximization" is based on present value concept. Wealth maximization is preferable to profit maximization as it is based on cash flow which is unambiguous and considers time value of money and risk.

Opportunity cost

As per net mba, Opportunity cost is based on what must be given up (the next best alternative) as a result of the decision. Any decision that involves a choice between two or more options has an opportunity cost. Hence opportunity cost is the cost of foregone choice. Example of Opportunity ...

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Response discusses business math key concepts

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