Future value computations are often referred to as

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Future value computations involve adding interest to an initial investment or principal over a period of time. This process is known as compounding, where the interest earned on the initial investment is reinvested, and the interest is also earned on that interest. Discounting and present value refer to the opposite process, where the value of future cash flows is brought back to their present-day value. Simple interest involves a fixed interest rate, whereas compounding involves interest earned on interest. An annuity refers to a series of equal payments made at regular intervals.

Future Value Computations Are Often Referred to as