Question

What is the difference between compounding (the determination of future value) and discounting (the determination of present value)

Answer 1

Compounding is the addition of the Interests to the Present Value to arrive at the Future Value. While discounting is the deduction of interest charges from thee Future Value to arrive at the Present Value.

Step-by-step explanation:

Compounding is the addition of the Interests to the Present Value to arrive at the Future Value. While discounting is the deduction of interest charges from thee Future Value to arrive at the Present Value.