Time Value of Money Online Module for Non-educators


Time Value of Money is designed to help students in economics, math and personal finance classes through what is often dry, mathematical content by featuring student-oriented language, program interactions, checks for understanding and video. This module will enhance students' in-class study of present and future value and also serve as a tutorial for those students who struggle with the concepts.

The financial security that comes with wealth accumulation requires an understanding of the time value of money. Students begin this module with a lesson on opportunity cost, the most fundamental consideration in any personal financial decision. Students move on to a lesson about interest where they recognize the importance of interest in sheltering them from the higher cost of living they are certain to experience in later years. The increase in their future cost of living will be due to inflation, the third subject they encounter in this program. Students use their knowledge of opportunity cost, interest and inflation to determine the future value of investments they may make as young adults and the present value of a sum of money they hope to have at a later date. Therefore, we recommend students work through each module.

Teachers: Learn more and preview the module for teachers and students.

In Time Value of Money, users will:

  • define opportunity cost and identify the opportunity cost of decisions, both financial and non-financial.
  • define interest and apply their knowledge in choosing the offer that results in the greatest monetary gain.
  • define inflation and explain why people have a time preference for money.
  • define future value, explain its meaning, describe its mathematical components and calculate it using the future value formula.
  • define present value, explain its meaning, describe its mathematical components and calculate it using the present value formula.


NAEE Gold Award Badge

This lesson received the 2016 Curriculum Gold Award from the National Association of Economic Educators.
Read more about our award-winning resources »


If you have difficulty accessing this content due to a disability, please contact us at 314-444-8624 or economiceducation@stls.frb.org.

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