Omg I'm SHOCKED how easy.. https://www.MBAbull.com or https://www.youtube.com/MBAbullshitDotCom (Slower original video here = https://www.youtube.com/watch?v=GJMad7KTpaw) Hi guys! Here's a super dooper easy video on Net Present Value. You will be shocked, guarantee it. Alright, so if I speak too fast, you can watch my original slower video. Just open this same video on You Tube and click the link in the description in You Tube. Alright, so I'd like to start with the word Net. What do we mean by Net? Well it's usually the result of different amounts combined. So for example if you're at a restaurant. And you order food for $100. That's expensive. And the discount is $15. So you'd be paying $85 Net. The word Net means it's simply a combination of the $100 and the negative $15 combined. So this becomes net. So how do we apply that in business? Well let's say that you paid $100 today to your friend and your friend would give you back $105 one year later. So this is negative. That's why it's red and this is positive that's why it's green. It's negative because you're paying it. This is positive because you're getting it. Alright, so in this case we can say that we have a Net Value of positive $5. Why? Because positive 105, negative 100, we get $5. So does this look like a good deal to you or not? I think it does look like a good deal. Think about it. You're getting 100 bucks, you're getting back the 105. You gain 5. It seems like a good deal, doesn't it? However in this case we're only talking about the net value. It's much better to think about the net present value. So present means today. So we have to think about the value of this $105 today, because $105 next year is not worth $105 today. Why? Because we have to think about the time value of money. What does the time value of money mean? It means that money given to you today is worth more than money given to you tomorrow. And it's worth much more than money given to you next year. Why? Because,for example, if a
Original Description
Omg I'm SHOCKED how easy.. https://www.MBAbull.com or https://www.youtube.com/MBAbullshitDotCom
(Slower original video here = https://www.youtube.com/watch?v=GJMad7KTpaw)
Hi guys! Here's a super dooper easy video on Net Present Value. You will be shocked, guarantee it. Alright, so if I speak too fast, you can watch my original slower video. Just open this same video on You Tube and click the link in the description in You Tube. Alright, so I'd like to start with the word Net. What do we mean by Net? Well it's usually the result of different amounts combined. So for example if you're at a restaurant. And you order food for $100. That's expensive. And the discount is $15. So you'd be paying $85 Net. The word Net means it's simply a combination of the $100 and the negative $15 combined. So this becomes net. So how do we apply that in business? Well let's say that you paid $100 today to your friend and your friend would give you back $105 one year later. So this is negative. That's why it's red and this is positive that's why it's green. It's negative because you're paying it. This is positive because you're getting it. Alright, so in this case we can say that we have a Net Value of positive $5. Why? Because positive 105, negative 100, we get $5. So does this look like a good deal to you or not? I think it does look like a good deal. Think about it. You're getting 100 bucks, you're getting back the 105. You gain 5. It seems like a good deal, doesn't it? However in this case we're only talking about the net value. It's much better to think about the net present value. So present means today. So we have to think about the value of this $105 today, because $105 next year is not worth $105 today. Why? Because we have to think about the time value of money. What does the time value of money mean? It means that money given to you today is worth more than money given to you tomorrow.
And it's worth much more than money given to you next year. Why? Because,for example, if a
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