Chapter 3

MAKING BIG DECISIONS

Sometimes the decision is minor and the calculation is as straightforward and clear as the ones described in the last chapter, but sometimes there is a lot more at stake than just the cost of a new appliance or where to go on vacation. In many of these more important decisions, there are many more factors to consider and more uncertainty about the future, which makes the determination of what to do more interesting. It is in these complex but vital areas where the power of Present Value and its application in our day-to-day lives begins to show its true worth.

Some of the most important decisions in our lives revolve around whether to make a major purchase or financial investment and, as I said before, these clearly ...

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