For your job as the business reporter for a local newspaper, you are given the task of putting together a series of articles that explain the power of the time value of money to your readers. Your...

For your job as the business reporter for a local newspaper, you are given the task of putting together a series of articles that explain the power of the time value of money to your readers. Your editor would like you to address several specific questions in addition to demonstrating for the readership the use of time value of money techniques by applying them to several problems. What would be your response to the following memorandum from your editor?

In your upcoming series on the time value of money, I would like to make sure you cover several specific points. In addition, before you begin this assignment, I want to make sure we are all reading from the same script, as accuracy has always been the cornerstone of the Daily Planet. In this regard, I’d like a response to the following questions before we proceed:

• a. What is the relationship between discounting and compounding?


• b. What is the relationship between the present value factor and the annuity present value factor?