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    Time value of money associated with commerical bank

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    How does Time value of money associated with commerical bank?

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    Time value of Money

    This concept is used by commercial banks to judge the financial position of its clients. If the clients projects are having positive Net present value then it grants the loan to them.
    Net present value concept is based on time value of money.
    To find out the present value of any investments:

    Present value is the future value being discounted by an appropriated capitalization rate. The value of sum of money received today is more than its value received after some time.
    In other words ...

    Solution Summary

    This discusses the time value of money associated with commercial bank.