Time Value of Money- Macroeconomics

Mr. Clifford introduces the concept of the time value of money, explaining the importance of understanding how money's value changes over time. He discusses future and present value calculations, using examples to illustrate how interest rates affect these values. The video emphasizes making informed financial decisions by comparing present and future values, and introduces the concept of compound interest, highlighting its significance in financial planning.

What is the present value of $100 a year from now at an interest rate of 10%?

If you need $200 in two years, how much should you invest today at a 10% interest rate?