Chapter 19. Building Investment Formulas
IN THIS CHAPTER
The time value of money concepts introduced in Chapter 18, “Building Loan Formulas,” apply equally well to investments. The only difference is that you need to reverse the signs of the cash values. That’s because loans generally involve receiving a principal amount (positive cash flow) and paying it back over time (negative cash flow). An investment, on the other hand, involves depositing money into the investment (negative cash flow) and then receiving interest payments (or whatever) in return (positive cash flow).
With this sign change in mind, this chapter ...