Net Present Value

In Business studies, Net Present Value theory is covered. it is part of Investment Appraisal and it basically covers the return on investment over a period of time. With inflation through cost of goods sold etc, the value of your money today will be worth far less in the future in terms of buying power. If you ask your Grandparents how much they bought their house for and compare it to the price your parents paid for theirs, there is a huge difference. I am sure you could name a few products that you have bought that have increased in price over time. The point is that one dollar or one pound etc will be worth less in the future. A pound now worth 33p