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The Definitive Guide to Business Finance: What smart managers do with the numbers, Second Edition
book

The Definitive Guide to Business Finance: What smart managers do with the numbers, Second Edition

by Richard Stutely
July 2008
Beginner
432 pages
11h 40m
English
Pearson
Content preview from The Definitive Guide to Business Finance: What smart managers do with the numbers, Second Edition

Investment arithmetic

This chapter is about the arithmetic of finance and investment. I hope this excites you. If instead it makes you feel nervous, let me reassure you. Talk of percentages, compound growth rates and discount rates might seem terrifying to some, but, if so, blame the educational system. These are actually simple concepts and they have the delight of being unarguable – back to one apple plus one apple is indubitably two apples. Moreover, the concepts presented here are the key to understanding investments. And who does not want to make one apple into ten apples or more.

Actually, if there is one theme for this chapter it is relationships – such as the relationships between:

  1. proportions and percentages

  2. growth and interest rates ...

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