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Gautam Kaul
The strength of finance is that it takes a structured approach to decision making, with one key building block underlying all decisions — understanding the value of time, or the Time Value of Money (TVM). In this course, we will develop this building block using introductory, and simple, applications. We will learn about the Time Value of Money (TVM), Simple Future Value (FV) , Simple Present Value (PV) , Future Value of Annuity, Loans, compounding, and Valuing Perpetuities. We will introduce the framework in a carefully structured and replicable way to prepare you to explore more advanced applications in the rest of the specialization. In the follow-on courses, we will expand the applications to more complex real-world decisions.
Read more
The strength of finance is that it takes a structured approach to decision making, with one key building block underlying all decisions — understanding the value of time, or the Time Value of Money (TVM). In this course, we will develop this building block using introductory, and simple, applications. We will learn about the Time Value of Money (TVM), Simple Future Value (FV) , Simple Present Value (PV) , Future Value of Annuity, Loans, compounding, and Valuing Perpetuities. We will introduce the framework in a carefully structured and replicable way to prepare you to explore more advanced applications in the rest of the specialization. In the follow-on courses, we will expand the applications to more complex real-world decisions.
Read more
The strength of finance is that it takes a structured approach to decision making, with one key building block underlying all decisions — understanding the value of time, or the Time Value of Money (TVM). In this course, we will develop this building block using introductory, and simple, applications. We will learn about the Time Value of Money (TVM), Simple Future Value (FV) , Simple Present Value (PV) , Future Value of Annuity, Loans, compounding, and Valuing Perpetuities. We will introduce the framework in a carefully structured and replicable way to prepare you to explore more advanced applications in the rest of the specialization. In the follow-on courses, we will expand the applications to more complex real-world decisions.
After completing this course, you will have an understanding of how the value of money changes over time. You will understand the implications of all your financial decisions, including saving for the future through different channels and borrowing for future needs. You will leave with the practical knowledge needed to make informed decisions on a wide range of financial decisions.
This course is part of the four-course Foundational Finance for Strategic Decision Making Specialization.
Register for this course and see more details by visiting:
OpenCourser.com/course/51s07k/introduction
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What's inside
Syllabus
Week 1: Time Value of Money - Simple Concepts & Applications
This week, we introduce the framework of time value of money (TVM) in a carefully structured way, with a focus on Future Value using relatively simple applications. As mentioned in the Syllabus, all concepts are introduced using examples and you are strongly encouraged to pause the videos and do every problem.
Read more
Syllabus
Week 1: Time Value of Money - Simple Concepts & Applications
This week, we introduce the framework of time value of money (TVM) in a carefully structured way, with a focus on Future Value using relatively simple applications. As mentioned in the Syllabus, all concepts are introduced using examples and you are strongly encouraged to pause the videos and do every problem.
Read more
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Traffic lights
Read about what's good
what should give you pause and
possible dealbreakers
Develops foundational financial concepts and tools that are core skills for financial decision-making
Carefully structures and replicates the framework in a way that prepares learners to explore more advanced applications in related courses
Uses simple examples and illustrations to make concepts relatable and easy to understand
Taught by Gautam Kaul, an instructor recognized for their work in finance
Requires learners to complete graded assignments to assess their understanding of the concepts
Assumes learners have basic math skills and may require additional support for those who struggle with the subject
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Reviews summary
Solid introduction to time value of money
According to learners, this course provides a solid introduction to the Time Value of Money (TVM). Many students highlight the clear explanations provided by the instructor, finding the concepts easy to follow and highly practical for real-world financial decisions. While the course is beginner-friendly, reviewers note that mastering the material requires active practice with the provided examples and assignments. The final week's Excel application is seen as a useful addition for applying concepts. Overall, it's considered a strong foundation for further study in finance.
Concepts require active practice to master the material.
"You really need to pause the videos and work through the problems yourself to grasp it."
"Mastering TVM requires consistent practice with the provided examples and quizzes."
"I had to redo some problems multiple times to fully grasp the concepts."
"Active engagement with the material is key to success."
Includes practical application using Excel.
"The Excel portion in the final week was a useful addition."
"Learned how to use Excel functions for TVM calculations, which is very practical."
"Good to see the concepts applied in a spreadsheet environment."
"Provided useful Excel templates and methods."
Concepts are directly applicable to real-world finance.
"I can immediately apply these TVM skills to my personal finances and investment planning."
"Useful for understanding loans, mortgages, and saving for the future."
"The examples used reflected real-life situations I encounter."
"Gave me practical tools for making better financial decisions."
Concepts are explained in an easy-to-understand way.
"The instructor explained TVM concepts very clearly and effectively."
"I found the lectures easy to follow, even with no prior finance knowledge."
"The breakdown of PV and FV calculations made perfect sense to me."
"Complex ideas were presented simply, which helped a lot."
The instructor is highly praised for their teaching.
"The professor is truly excellent at explaining complex topics clearly and engagingly."
"I appreciated the instructor's clear delivery and enthusiasm for the subject."
"Best finance instructor I've had in an online format."
"Their teaching style made the potentially dry subject matter interesting."
Activities
Be better prepared
before
your course. Deepen your understanding
during
and
after
it. Supplement your coursework and achieve mastery of the topics covered
in Introduction to Time Value of Money (TVM) with these
activities:
Review Basic Math Concepts
Show steps
Strengthen your mathematical foundation to enhance your understanding of Time Value of Money.
Browse courses on
Algebra
Show steps
-
Revisit concepts such as exponents, logarithms, and basic algebra.
-
Solve practice problems to refresh your skills.
Review Algebraic Manipulations
Show steps
Review fundamental algebraic rules and operations to strengthen your foundational understanding.
Browse courses on
Algebra
Show steps
-
Go through your old Algebra notes.
-
Do at least 100 practice problems covering various algebraic operations.
-
Take a practice quiz to test your understanding.
Create a Comprehensive Study Guide for Time Value of Money
Show steps
Consolidate your notes, practice problems, and other resources into a single organized guide.
Show steps
-
Gather all of your existing notes and materials on time value of money.
-
Organize the materials into a logical flow, starting with the basics and progressing to more advanced topics.
-
Add additional explanations, examples, and practice problems to fill in any gaps in your understanding.
-
Have a friend or mentor review your guide to ensure clarity and completeness.
13 other activities
Expand to see all activities and additional details
Show all 16 activities
Weekly Study Group on Time Value of Money
Show steps
Join a study group to discuss concepts, work on problems, and learn from others.
Show steps
-
Find a group of peers to study with.
-
Choose a time to meet regularly, such as weekly.
-
Take turns leading the discussions and sharing your understanding of the material.
Calculate Present Value
Show steps
Develop proficiency in the essential computations in the Time Value of Money.
Show steps
-
Solve ten problems based on the formula of Present Value.
-
Calculate the Present Value of a series of cash flows for five examples.
Solve Time Value of Money Problems in a Group
Show steps
Collaborate with classmates to reinforce your understanding and develop problem-solving skills.
Show steps
-
Form a small study group with 2-3 classmates.
-
Select a set of Time Value of Money problems to solve together.
-
Discuss your approaches and solutions, and learn from each other.
Excel for Financial Modeling
Show steps
Learn how to use Excel's advanced features, such as formulas and functions specific to finance.
Show steps
-
Find a comprehensive tutorial on Excel for financial modeling.
-
Follow the tutorial and complete all the exercises.
-
Create a practice model to apply your new skills.
Explain the Time Value of Money to a Non-Finance Person
Show steps
Challenge yourself to explain the concept of time value of money in a clear and accessible way.
Show steps
-
Understand the concept yourself.
-
Break down the concept into simpler terms.
-
Use analogies and examples to illustrate the concept.
Explore Time Value of Money Applications
Show steps
Expand your knowledge of Time Value of Money by exploring real-world applications in finance.
Show steps
-
Identify an online tutorial or video that covers applications of Time Value of Money.
-
Follow the tutorial or video and take notes on key concepts and examples.
-
Discuss your findings with a同学 or mentor.
Fundamentals of Finance by Brigham and Ehrhardt
Show steps
Gain a deeper understanding of the fundamental principles of finance, including time value of money.
View
Financial Management: Theory & Practice...
on Amazon
Show steps
-
Read through the chapters on time value of money.
-
Work through the examples and exercises in the book.
Time Value of Money Calculations
Show steps
Practice solving problems related to the time value of money to improve your accuracy and speed.
Show steps
-
Gather a set of practice problems on TVM.
-
Solve the problems using the appropriate formulas.
-
Check your answers against the provided solutions.
Create a Tool Kit for Time Value of Money
Show steps
Integrate your knowledge and create a resource that will reinforce your understanding throughout the course.
Browse courses on
Time Value of Money
Show steps
-
Develop a list of formulas, concepts, and examples
-
Organize the materials into a document or spreadsheet
-
Test the tool kit by solving a realistic problem
Volunteer at a Financial Literacy Program
Show steps
Apply your knowledge and gain hands-on experience in teaching others about financial concepts.
Show steps
-
Find a financial literacy program in your community.
-
Contact the program and inquire about volunteer opportunities.
-
Prepare to teach lessons on basic financial concepts, such as budgeting and saving.
Develop a Time Value of Money Calculator
Show steps
Demonstrate your understanding by building a tool that can perform Time Value of Money calculations.
Browse courses on
Time Value of Money
Show steps
-
Choose a programming language and development environment.
-
Design the user interface and functionality of the calculator.
-
Implement the Time Value of Money formulas in your code.
-
Test the calculator with different inputs and scenarios.
Contribute to a Time Value of Money Python Library
Show steps
Deepen your understanding by contributing to a real-world project related to Time Value of Money.
Browse courses on
Time Value of Money
Show steps
-
Identify an open-source Python library that focuses on Time Value of Money.
-
Review the documentation and codebase of the library.
-
Identify an area where you can make a contribution, such as adding a new feature or fixing a bug.
-
Submit a pull request with your changes.
Personal Finance Plan
Show steps
Create a comprehensive financial plan that incorporates the principles of time value of money.
Show steps
-
Gather your financial information, including income, expenses, and assets.
-
Set financial goals, such as saving for retirement or buying a house.
-
Develop a plan to achieve your goals, including budgeting and investment strategies.
-
Monitor your progress and make adjustments as needed.
Review Basic Math Concepts
Show steps
Strengthen your mathematical foundation to enhance your understanding of Time Value of Money.
Browse courses on
Algebra
Show steps
Show steps
Show steps
- Revisit concepts such as exponents, logarithms, and basic algebra.
- Solve practice problems to refresh your skills.
Review Algebraic Manipulations
Show steps
Review fundamental algebraic rules and operations to strengthen your foundational understanding.
Browse courses on
Algebra
Show steps
Show steps
Show steps
- Go through your old Algebra notes.
- Do at least 100 practice problems covering various algebraic operations.
- Take a practice quiz to test your understanding.
Create a Comprehensive Study Guide for Time Value of Money
Show steps
Consolidate your notes, practice problems, and other resources into a single organized guide.
Show steps
Show steps
Show steps
- Gather all of your existing notes and materials on time value of money.
- Organize the materials into a logical flow, starting with the basics and progressing to more advanced topics.
- Add additional explanations, examples, and practice problems to fill in any gaps in your understanding.
- Have a friend or mentor review your guide to ensure clarity and completeness.
13 other activities
Expand to see all activities and additional details
Show all 16 activities
Weekly Study Group on Time Value of Money
Show steps
Join a study group to discuss concepts, work on problems, and learn from others.
Show steps
Show steps
Show steps
- Find a group of peers to study with.
- Choose a time to meet regularly, such as weekly.
- Take turns leading the discussions and sharing your understanding of the material.
Calculate Present Value
Show steps
Develop proficiency in the essential computations in the Time Value of Money.
Show steps
Show steps
Show steps
- Solve ten problems based on the formula of Present Value.
- Calculate the Present Value of a series of cash flows for five examples.
Solve Time Value of Money Problems in a Group
Show steps
Collaborate with classmates to reinforce your understanding and develop problem-solving skills.
Show steps
Show steps
Show steps
- Form a small study group with 2-3 classmates.
- Select a set of Time Value of Money problems to solve together.
- Discuss your approaches and solutions, and learn from each other.
Excel for Financial Modeling
Show steps
Learn how to use Excel's advanced features, such as formulas and functions specific to finance.
Show steps
Show steps
Show steps
- Find a comprehensive tutorial on Excel for financial modeling.
- Follow the tutorial and complete all the exercises.
- Create a practice model to apply your new skills.
Explain the Time Value of Money to a Non-Finance Person
Show steps
Challenge yourself to explain the concept of time value of money in a clear and accessible way.
Show steps
Show steps
Show steps
- Understand the concept yourself.
- Break down the concept into simpler terms.
- Use analogies and examples to illustrate the concept.
Explore Time Value of Money Applications
Show steps
Expand your knowledge of Time Value of Money by exploring real-world applications in finance.
Show steps
Show steps
Show steps
- Identify an online tutorial or video that covers applications of Time Value of Money.
- Follow the tutorial or video and take notes on key concepts and examples.
- Discuss your findings with a同学 or mentor.
Fundamentals of Finance by Brigham and Ehrhardt
Show steps
Gain a deeper understanding of the fundamental principles of finance, including time value of money.
View
Financial Management: Theory & Practice...
on Amazon
Show steps
Show steps
Show steps
- Read through the chapters on time value of money.
- Work through the examples and exercises in the book.
Time Value of Money Calculations
Show steps
Practice solving problems related to the time value of money to improve your accuracy and speed.
Show steps
Show steps
Show steps
- Gather a set of practice problems on TVM.
- Solve the problems using the appropriate formulas.
- Check your answers against the provided solutions.
Create a Tool Kit for Time Value of Money
Show steps
Integrate your knowledge and create a resource that will reinforce your understanding throughout the course.
Browse courses on
Time Value of Money
Show steps
Show steps
Show steps
- Develop a list of formulas, concepts, and examples
- Organize the materials into a document or spreadsheet
- Test the tool kit by solving a realistic problem
Volunteer at a Financial Literacy Program
Show steps
Apply your knowledge and gain hands-on experience in teaching others about financial concepts.
Show steps
Show steps
Show steps
- Find a financial literacy program in your community.
- Contact the program and inquire about volunteer opportunities.
- Prepare to teach lessons on basic financial concepts, such as budgeting and saving.
Develop a Time Value of Money Calculator
Show steps
Demonstrate your understanding by building a tool that can perform Time Value of Money calculations.
Browse courses on
Time Value of Money
Show steps
Show steps
Show steps
- Choose a programming language and development environment.
- Design the user interface and functionality of the calculator.
- Implement the Time Value of Money formulas in your code.
- Test the calculator with different inputs and scenarios.
Contribute to a Time Value of Money Python Library
Show steps
Deepen your understanding by contributing to a real-world project related to Time Value of Money.
Browse courses on
Time Value of Money
Show steps
Show steps
Show steps
- Identify an open-source Python library that focuses on Time Value of Money.
- Review the documentation and codebase of the library.
- Identify an area where you can make a contribution, such as adding a new feature or fixing a bug.
- Submit a pull request with your changes.
Personal Finance Plan
Show steps
Create a comprehensive financial plan that incorporates the principles of time value of money.
Show steps
Show steps
Show steps
- Gather your financial information, including income, expenses, and assets.
- Set financial goals, such as saving for retirement or buying a house.
- Develop a plan to achieve your goals, including budgeting and investment strategies.
- Monitor your progress and make adjustments as needed.
Career center
Learners who complete Introduction to Time Value of Money (TVM) will develop knowledge and skills
that may be useful to these careers:
Financial Analyst
Financial Analyst
Financial Analysts regularly prepare financial reports and make recommendations, which may help them succeed with the practical knowledge they gain in this course. This course can help Financial Analysts understand the implications of their financial decisions, including how to save for the future and borrow for future needs.
Investment Banker
Investment Banker
Investment Bankers need to understand the value of time as it pertains to money. This is a crucial skill for evaluating investment opportunities and making sound financial decisions. This course provides a solid foundation for these skills, which are essential for career growth in Investment Banking.
Auditor
Auditor
Auditors examine financial records to ensure accuracy and compliance with regulations. Time Value of Money (TVM) is a crucial concept in Auditing. This course provides a comprehensive understanding of TVM, which can help auditors make informed judgments and enhance their auditing skills.
Budget Analyst
Budget Analyst
Budget Analysts develop and manage budgets for organizations. This course provides a foundation in Time Value of Money (TVM), which is essential for understanding the long-term financial implications of budgeting decisions and ensuring the effective allocation of resources.
Credit Analyst
Credit Analyst
Credit Analysts assess the creditworthiness of individuals and businesses. A solid understanding of Time Value of Money (TVM) is crucial for evaluating loan applications, determining credit limits, and making informed lending decisions. This course provides a valuable foundation for Credit Analysts.
Financial Planner
Financial Planner
Financial Planners help individuals and families plan for their financial future. Time Value of Money (TVM) is a core concept in financial planning, as it allows Planners to evaluate the time value of investments and make informed decisions about retirement savings, education funding, and other financial goals.
Risk Manager
Risk Manager
Risk Managers identify, assess, and mitigate financial risks. Time Value of Money (TVM) is a valuable tool for evaluating the potential financial impact of risks and developing strategies to manage them effectively.
Actuary
Actuary
Actuaries use mathematical and statistical methods to assess risk and uncertainty. A strong understanding of Time Value of Money (TVM) is essential for Actuaries, as it enables them to calculate the present value of future cash flows and make informed decisions about insurance premiums and other financial matters.
Investment Advisor
Investment Advisor
Investment Advisors provide financial advice and management services to individuals and institutions. Time Value of Money (TVM) is a fundamental concept in investment management, as it allows Advisors to evaluate the time value of investments and make informed decisions about portfolio allocation and risk management.
Loan Officer
Loan Officer
Loan Officers assess loan applications and determine creditworthiness. Time Value of Money (TVM) is crucial for Loan Officers, as it enables them to calculate loan payments, interest charges, and the overall cost of borrowing.
Real Estate Agent
Real Estate Agent
Real Estate Agents help clients buy, sell, and rent properties. Time Value of Money (TVM) may be helpful for Real Estate Agents, as it can help them evaluate the time value of real estate investments and make informed decisions about pricing and negotiations.
Insurance Agent
Insurance Agent
Insurance Agents sell insurance policies to individuals and businesses. Time Value of Money (TVM) may be helpful for Insurance Agents, as it can help them evaluate the time value of insurance premiums and make informed decisions about policy recommendations.
Tax Accountant
Tax Accountant
Tax Accountants prepare tax returns and advise clients on tax matters. Time Value of Money (TVM) may be helpful for Tax Accountants, as it can help them evaluate the time value of tax payments and make informed decisions about tax planning strategies.
Accountant
Accountant
Accountants prepare and maintain financial records for businesses and individuals. Time Value of Money (TVM) may be helpful for Accountants, as it can help them evaluate the time value of financial transactions and make informed decisions about accounting practices.
Economist
Economist
Economists study the production, distribution, and consumption of goods and services. Time Value of Money (TVM) may be helpful for Economists, as it can help them evaluate the time value of economic decisions and make informed predictions about economic trends.
For more career information including salaries, visit:
OpenCourser.com/course/51s07k/introduction
Reading list
We've selected eight books
that we think will supplement your
learning. Use these to
develop background knowledge, enrich your coursework, and gain a
deeper understanding of the topics covered in
Introduction to Time Value of Money (TVM).
Widely used textbook on investments. It provides a comprehensive overview of the subject, including topics such as asset allocation, portfolio management, and risk management. It would be a valuable resource for students who want to learn more about investing.
Provides a practical guide to corporate finance. It includes case studies and examples that illustrate how financial principles are applied in the real world.
Save
Classic textbook on corporate finance. It provides a comprehensive overview of the subject, including topics such as capital budgeting, cost of capital, and dividend policy. It would be a valuable resource for students who want to learn more about the financial management of corporations.
Provides a comprehensive overview of options, futures, and derivatives. It would be a valuable resource for students who want to learn more about these complex financial instruments.
Provides a comprehensive overview of the time value of money. It would be a valuable resource for students who want to learn more about this important financial concept.
Save
Provides a clear and concise overview of the principles of finance. It would be a valuable resource for students who want to learn more about the basics of this subject.
Provides a comprehensive overview of the financial markets and institutions. It would be a valuable resource for students who want to learn more about how the financial system works.
Save
Provides a comprehensive overview of econometrics. It would be a valuable resource for students who want to learn more about the statistical methods used in economics.
For more information about how these books relate to this course, visit:
OpenCourser.com/course/51s07k/introduction
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Rating
4.8
Effort
Approx. 12 hours
Level
Introductory
Via
Coursera
Institution
University of Michigan
Instructor
Gautam Kaul
Language
English
Transcripts
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