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Transcript of A Study on Essence of the Phrase Time is Money
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A Study on Essence of the Phrase "Time is Money"
Submitted in partial fulfillment of the requirements
for the award of the degree of
Bachelor of Business Administration (BBA)
Semester-III (Paper Code-BBA 211)
To
Guru Gobind Singh Indraprastha University, Delhi
Guide: Submitted byName of Guide Name of Student
Roll No. :
Institute of Innovation in Technology & Management,
New Delhi 110058
Batch (2008-2011)
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Certificate
I, Mr/Ms_______________________________, Roll No. ________________ certify that the
Minor Project Report (Paper Code-------) entitled ________________________________ is
completed by me by collecting the material from the referenced sources. The matter embodied
in this has not been submitted earlier for the award of any degree or diploma to the best of my
knowledge and belief.
Signature of the StudentDate:
Certified that the Minor Project Report (Paper Code-------) entitled _________________ done
by Mr/Ms__________________, Roll No. ___________, is completed under my guidance.
Signature of the GuideName of the Guide:Designation:Date:
Countersigned
Director/Project Coordinator
CONTENT
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S.No. Topic Page No.
1 Certificate
2 Acknowledgement
3 List of Tables
4 List of Figures5 List of Symbols
6 List of Abbreviations
7 Chapter-1: Introduction 1
8 Chapter-2: Literature Review 10
9 Chapter-3: Research Methodology 29
10 Chapter-4: Finding & Analysis 31
11 Chapter-5: Conclusion 41
12 Chapter-6: Recommendations 43
13 References/Bibliography 4514 Appendices 46
LIST OF TABLES
Table No. Title Page No.
1 Future Value Factors 21
LIST OF FIGURES
Figure No. Title Page No.
1 Gender of the respondents 31
2 Age of the respondents 32
3 Believe in Statement Time is Money 33
4 Importance of time in life 34
5 Scheduling of daily life 35
6 Thinking about time table is an effective way in case of
time saving
36
7 Wasting of time unnecessary way 37
8 Time is the valuable thing for any kind of business 38
9 Time waste means loss of money 39
10 The suitable use of time is very essential in currentconditions
40
LIST OF SYMBOLS
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S. No. Symbol Nomenclature & Meaning
1 $ Dollar
2 Sigma
3 * Star
4 % Percent
LIST OF ABBREVIATIONS
S. No. Abbreviation Name Full Name
1 TV Television
2 CD Computer Disk
3 e.g that is
4 PV Present Value5 FV Future Value
6 CF Cash Flow
7 FVIF Future value factor
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Chapter-1
Introduction
1.1Time is money:
It's an old cliche that we all know and understand, but to what extent do you really apply it in
your business? For example, do you make a phone call when an email would do just fine? Sure,
there's something to be said for spending a little extra time building rapport with your clients,
but phone calls often stretch out into ten, twenty, thirty minutes when taking five minutes to
craft an email would have gotten the job done. Remember, your clients and strategic partners
are busy too -- they may appreciate the efficiency of an email instead of a phone call.
On the other hand, are you an "email person", who insists on going back and forth via email,
when a phone call is clearly necessary to iron out the issue? If something is going to require a
lot of back-and-forth, a phone call may be more efficient. If you're trying to come to an
agreement about something and you exchange more than two rounds of email, it's time to just
pick up the phone.
What about picking up checks from clients? Entrepreneurs are always in a hurry to get paid, it
seems, and again, there's something to be said for building rapport with clients. But often,
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picking up a check may mean the only person you actually speak to is the receptionist at their
office. Is it really worth an hour of your time to say hello to their receptionist and get paid 1-2
days sooner? Just ask them to mail it to you.
1.2 How much is your time worth?
Have you figured it out? If not, you should. To figure the minimum, figure out how much
money you're making per year and divide it by 2,000. To figure the maximum, consider how
much you make for your most productive time -- closing a deal, a speaking engagement,
billable client time, etc. Somewhere in between there is the real value of your time.
There's a saying which I recall reading somewhere (I thought it was Harvey Mackay, but I
haven't been able to track down the quote):
Don't pay someone $25 an hour to do $7 an hour work.
Plug your own numbers in there. Maybe it needs to be, "Don't pay someone $50 an hour to do
$20 an hour work." You're the first number. Whatever your time is worth, think about each and
every activity that you're spending time on a regular basis. Could you outsource it to a
bookkeeper, a virtual assistant, a web designer, a copywriter, a part-time employee, your
spouse or even one of your kids? It's very difficult for most entrepreneurs to relinquish that
control and delegate, but it's one of the best ways that you can ultimately increase your income
while decreasing the number of hours you work.
Remember - most resources are potentially unlimited. There's no limit to how much money you
can make (someone can pass up Bill Gates, right?). There's no limit (other than self-imposed)
as to how many customers you can have, or employees, or locations, or products or anything
else.
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But there are only 24 hours a day, 7 days a week, 52 weeks a year, and you have to spend some
of that time sleeping, eating, playing, relaxing and growing with yourself, your friends and
your family. Time is an entrepreneur's mostprecious resource, because it is the only one that is
truly scarce. Be stingy with it.
1.3 The Connection between Time and Money:
You have probably heard people use the statement "time is money" many times. While it
sounds like a simple statement, it is much more complex then you may think. There are certain
connections that time has with money, but there are also some notable differences as well.
The connection between time and money is something that is well understood among most
large companies. They understand the importance of time management, and this is why many
of them have tardy policies for their employees. If you are a college student, your instructors
may talk to the class about the importance of being on time at the beginning of the semester. If
you show up late to class, you may have to deal with penalties or other problems. How you
manage your time will play an important role in whether you are a success and failure in life. If
you talk to most people, virtually all of them will tell you that they want to become wealthy.
Others will tell you that they want to be self employed so they can work for themselves instead
of someone else. However, their actions will often speak louder than their words. To
understand this, all you have to do is look at the 80/20 principle. Only about 20 percent of the
population has become either self employed or wealthy. The other 80 percent will never
achieve these goals. While there are many reasons for this, one cause is the way most people
spend their time. While many people will tell you about how wrong it is to waste money, you
won't hear them talking about the importance of not wasting time. In a sense, time is more
valuable than money. It is more valuable because it can never be gained back once it has been
lost. If you talk to most people who are millionaires, they already understand this. They also
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understand the 80/20 principle. They know that 20 percent of the things they do will play a big
role in whether they fail or succeed. They don't waste much time dealing with the other 80
percent. If your goal is to become financially independent, there are a number of questions you
should ask yourself. How much time do you spend engaged in activities which will allow you
to become financially independent? How much time do you spend researching activities that
can make you financially independent? How much time do you spend learning the necessary
skills to help you succeed in a field you're interested in pursuing? How much time do you
spend watching television, playing games, going to clubs, or spending time with your friends?
These are questions that only you will be able to answer. The answers that you get for these
questions will tell you whether or not you are on the road to achieving your goals. If you are
not happy with the answers, this means you have some areas where you need to improve. You
will first need to learn how to use the 80/20 principle to succeed. This may require you to make
some changes to your lifestyle, and this may be difficult. If you are a young person who wants
to be self employed, but you are spending most of your time at parties on the weekend, you
may need to reverse the situation. Instead of spending most of your time at parties, you will
need to begin spending more time researching ways that you can become self employed. This is
what separates wealthy people from those that never become wealthy. They understand the
importance of time management, and they undestand the connections between time and money.
This is also the reason why your boss gets angry at you when you come into work late. When
you don't start and complete your tasks on time, you will cost yourself or those you work for
money. Lost time equals lost money. If you are an employee of a company, the amount of time
you and your co-workers spend working will determine the profits that are earned by the
company. When everyone is coming in late, this will massively cut into the profits of the
company over a long period of time.
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1.4 "Time is money" - a significant experience that has special meaning,
It is an old quote that Time is Money and everyone has heard this sentence. But we are not
fully aware from the meaning and the importance of this sentence. Time can make money but
from money no one can make time. In this modern world where life is moving so fast, there is a
shortage of time. Therefore, it is necessary to know the value of time.
Nowadays everyone especially children are wasting their time because they are not fully aware
from the fact that how much important time is? They are not seeing their dark future, thats
why they are wasting time in playing games and other negative activities. It is not like that the
child should be a book bug. He should also play but on time, because excess of everything is
harmful. It is the duty of parents to remind their children about the importance of time and to
remind them of the difficulties of practical life. Nowadays, children are wasting their time
sitting in front of computer and playing games, in watching T.V, and in playing sports. They
should concentrate on their studies; Extra-Curricular activities are good but should be limited.
The children should utilize their time in positive activities, like reading Magazines, reading
different books and newspaper.
The biggest example of not properly utilizing the time is that children are wasting their time as
they are spending daily 3 to 4 hours in front of computer but they even dont know how to
repair the computer. Internet is the best and easily available source of knowledge to the new
generation, but instead of using it in the right manner they are using it negatively. Now this era
is very tough and the upcoming era will be the toughest. Only those will survive who are
utilizing their time in positive things. Wastage of time wont give anything, because once time
runs away, than it never returns. So it is better to save time and utilize it in bringing some new
creations and innovations. Time is more expensive than money therefore its importance should
be realized. A human being should be efficient enough to utilize his time in the best possible
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way. Just take the example of multinational companies. Their motto is to save time because
they know that saving time will be beneficial and helpful for them to make more money.
Remember there is no limit of earning money. A person can earn more money than Bill Gates
but to do this all you need is proper utilization of time. Time always matters in everything.
Never left work on tomorrow, try to complete your work by today, because this saving of time
will be obviously beneficial for you. Keep this thing in mind that there are 24 hours in a day in
which we eat, sleep, and relax and by deducting all the time from these activities, we are
approximately left with only 15 hours and wasting more time than 15 hours is harmful. Those
who do not respect time, time also do not respect them. Wasting of time is very harmful and
consequences will be severe if we are not using the time appropriately. Wasting of time is a
major cause of unemployment for future. Students who are wasting their time are indirectly
harming their own selves. Student waste their time in negative activities and in playing games
which results in failing of their exams. Students should also use their time in a proper way to
get their future better and brighter.
It is a bad thing if we constantly obsess over time. But sometimes, we need to be conscious of
it. The reason for this is simply because we don't get time back. Whatever position you happen
to be in, ask yourself some serious questions. In the past, have you used time wisely? On a
scale of 1-10, how much do you put value to time? Do you go about the day not even worrying
about the time that passes by?
Most people won't worry about time passing by. This is because we do not wish to let time pass
by. We grow older as it passes by and not everybody likes this, and not everybody wants to
know the future.
But I think if we use our time wisely, it will make us more confident of our future. Whether
you like it or not, whether you choose to ignore it, time will pass by anyway no matter what. If
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you think about it, anything can be exchanged for. I can exchange money for an item, and I can
exchange an item for money. But I cannot exchange money for more time, and I cannot
exchange an item for more time.
Everybody more or less has time. Not everybody has a nice house and not everybody has a nice
car, but everybody has time. It's really what we do in that time that separates successful people
from unsuccessful people.
If you're a busy person than you probably have a busy schedule such as going to work from 7 in
the morning to 5 in evening, coming home and having dinner with the family, doing some
paper work, watching some TV, then going to bed at 11 and then waking up at 6. I know some
people who go to school and work at the same time and have only a couple of hours of the day
for "free time".
But there are people who just wake up in the morning like at 11 or 12, eat brunch or lunch, go
on the internet or maybe watch some TV for a couple of hours, eat something that makes them
tired so they take a 1 or 2 hour nap, wake up and receive a phone call to go out with friends for
dinner, come home late, go on the internet or play computer games until 2 or 3 in the morning,
then go to sleep.
This is an example of not using time wisely - duh.
that was promoting a product or service such as a... I don't know sleeping nighttime CD's for
people who have trouble sleeping and these CD's cost $20 and you got 50% commission or $10
for each time helped promoted this item, a person who is working 10 hours will get $100, and
if you're just working on the website for 10 dollars, you will get $0. What I'm trying to get
across is that if you're trying to make more money, or set some type of business, or just have a
project that you have in mind that is going to be a lot of hard work, time is your best friend.
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Whatever project that you have in mind, chances are that there's a good chance that hundreds of
thousands of people that you don't know about are doing the same thing, except they are using
time in doing it while others are wasting their time not doing it.
All I'm saying is be aware of time. Time is leverage.
If you have more time to do something than another person, that is worth so much.
People don't value time these days, because, well, it's not money. It's not something that you
can touch or hold in your hands. You can't really see time. You can see time passing by on a
clock... but that's not too exciting is it? Although passing time isn't that big of a concern to most
people, time in fact is one of the most precious things we as human beings have.
Time really is more powerful than money. With 10 hours work, one can get $100 worth on
money. But with $100, one cannot get 10 hours back in his or her life. Those 10 hours are gone
forever.
Each hour that passes by is an opportunity to make money. Notice I didn't say each hour that
passes by that you will make money, but each hour that passes by you can use that hour to
build something that will make you money in the future.
If you work in a job that basically gives you, for example $10 an hour, then you're basically
trading an hour of your life for $10. This isn't a bad thing at all, but if you are complaining
about not having enough money, realize that you are the one who has accepted trading 1 hour
of your life for $10. There are many ways to earn more than $10 for 1 hour of your time.
For example, if you spent 10 hours making a website
But on the 11th hour, you might make a sale and get 10 dollars, while the other person working
will also get 10 dollars, and 11th hour you might get 20 dollars, while the other person gets 10
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dollars, and on the 13th hour you might get 30 dollars, while the other person gets 10 dollars
and I think you get the idea. If we were going by this scale, by the time the other person has
worked 20 hours, they will receive $200. By the time you reached 20 hours, you will have
made $550.
Of course this is only an ideal case. But you can see how valuable time is if you use time
wisely. Even if you aren't making money in a set amount of time right now, you can always be
able to produce something of value with the time you have and exchange that for money later.
The most important thing I think we should understand is that time is going to pass us by
anyway so we have the option to choose to let it pass by and just let it pass by with nothing
really happening, or choose to let it pass by but knowing that something positive will result in
the future because we are doing something right now.
And it doesn't have to be just for money, it can be for a skill that you want to learn like playing
an instrument or any other type of goal you wish to achieve such as losing more weight or
gaining more muscle. Whatever it happens to be, understand that time doesn't wait for us. It
always continues. And it is what you choose to do with time right now that will ultimately
determines the outcome of your future.
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Chapter-2
Literature Review
2.1 Introduction:
In economic terms, things acquire value whenever people want or need the thing but the supply
of the thing is not sufficient to satisfy everyone's wants or need for it. Take gold for
instance. This metal is both beautiful and very scarce. It can be used to make beautiful
jewelry and other objects of beauty which are desired by large numbers of people.
However, because there is very little gold in the world relative to the amount that
people want, it has a very high value as evidenced by the large quantity of other things
people are willing to give in exchange for gold. As I am writing this Hub response
(January 2009) the current price of one ounce of gold is $876 - this is simply for a one
ounce piece of the metal that has been mined and refined into a small chunk of pure
metal that can be converted into something else. Turning it into a piece of jewelry will
require added work and expense. Contrast this with an ounce of dirt which anyone can
reach down and scoop up off the ground at any time for free.
Value is determined almost exclusively by an object's relative scarcity rather than by its need to
sustain life as evidenced by the famous diamond/water paradoxin economics. Like
gold, diamonds are both beautiful and scarce but, also like gold, by themselves
provide nothing in terms of sustaining life by nourishing our bodies or sheltering us
from the elements. Granted, if we have gold or diamonds we can trade them for food,
water, clothing or shelter but we can't use them directly for these purposes. Water, on
the other hand, is absolutely necessary for life - three days without water and a person
is dead. Yet, diamonds command a very high price and water, in most places, is free
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or nearly free. This is due to the fact that the earth is made up of about 75% or more of
water while diamonds make up some tiny fraction of one percent of the earth. As a
result of its relative abundance, we tend to take life giving water for granted and place
a high value on diamonds (if you don't believe this, just try giving your wife a glass
water for an anniversary present). Of course, someone near death in the desert from
thirst will gladly exchange a bag of diamonds for a glass of water which shows that
when the relative quantities are changed with water being scarce and diamonds
abundant the values change as well.
2.2 Time and Value:
So, what about time? Time is also a scarce resource since each of us has just 24 hours at our
disposal each day and our lives are finite. Looking at time in terms of the immediate present or
the near future up to say a year or so we can see that time is limited and will tend to treat it as
such. With the possible exception of the very old or those with a terminal disease or other
condition (such as a condemned prisoner) most of us tend to look upon our lifetime supply of
time as nearly infinite and will tend to take it for granted like water.
Unlike most other objects that have economic value, time tends to be invisible in the sense that
we can't see it or feel it like some physical object. However, like other physical objects we can
trade it or sell it for other things or acquire more by buying it or trading something else for it.
Every time a homeowner pays someone to cut the lawn, clean the pool or do some other time
consuming household task rather than doing it themselves the homeowner has just brought
some time as that person can now go play golf or engage in some other fun activity on Saturday
afternoon rather than staying home and cutting the lawn or cleaning the pool. Similarly, every
time we work for money or other goods we are basically trading or selling our time in exchange
for money or other goods
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The human race has progressed and improved its lot materially down through the ages by
learning how to increase the quantity of scarce resources. Of course, the more success it has
had in increasing abundance has been more than offset by the fact that our wants have
increased by even more. As any parent or grandparent (from any era, not just the present) much
of what our children and grandchildren deem as the minimal necessities of life didn't even exist
when we were young. While my grandparents could recall when telephones became common
enough so that their family could afford one, cell phones are so common that even babies who
can't talk yet are given toy cell phones to play with.
Many people today look back nostalgically at the slower pace of life people had in the past.
Today we rush around and never seem to have enough time while our ancestors a
hundred or so years ago or more appear to have lived simpler and less complicated
lives than we do today. We forget that their lives were simpler because they had fewer
choices to occupy their time. In the absence of cars, people were forced to live and
work within a much smaller area and, even within that limited area, the lack of fast
transportation limited the time available for recreation beyond the home. Little
League, soccer, dance lessons, etc. for children are available today because cars allow
us to keep the travel time to and from these things to a minimum - use a horse and
buggy and the time needed to travel to and from the Little League field will be such
that there won't be time for the practice or a game. In the absence of microwaves and
frozen foods someone will have to spend hours preparing a meal. Today cooking is a
hobby for most people while in the past it consumed a good part of someone's (usually
the wife's) day every day. Food, clothing and shelter are necessities of life and our
pre-historic ancestors, like our animal cousins, devoted almost 100% of their working
lives to supplying these basic needs. Foraging for each day's food was an all day job.
Civilization began, once we learned how to domesticate farm animals and cultivate
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grains and vegetables thereby having access to a supply of food by the home and
eliminating the time needed to wander in search of game or edible plants. Continued
advances in food production and preservation techniques have allowed us meet this
basic need while spending less and less time producing food or, as is the case of most
of us, less and less time earning the money needed to buy the food from the few who
produce it.
Greater efficiency in the production of food and other basic needs is not the only factor in
increasing the time available for other things. Advances in transportation have provided us with
the means to go more places and do more things because the time required to go places has
been reduced. Advances in communications have also increased our time by eliminating travel
time altogether. Today I can go online and with a few clicks pay my bills for the month thereby
saving the time it used to take to write checks, address envelopes, go to the post office for
stamps and go to the mailbox to mail the payments.
Electric lighting is another technology which has allowed us to increase our time by extending
light into the hours of darkness. I have seen studies which have shown that in times past when
artificial light was limited to camp fires or candles people tended to rise with the sun and go to
bed when the sun set. Since there was little to do in the dark other than go to bed (with the
possible exception of sex which is best done in bed and requires no light and which is probably
one of the reasons why people had more children in the past). People's bodies and sleep needs
adjusted automatically to the changing length of days and, with the invention and availability of
artificial light allowed them to adjust further and spend more time awake than asleep.
Advances in food production, which provides us with a steady and uninterrupted supply of
food, along with other advances that have made life safer has led to increased life spans. We
now live much longer than our primitive ancestors which means that, in addition to reducing
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the time needed to provide the essentials needed to sustain life, we have also created more time
for everyone by giving them longer lives. These and other advances now allow us to bank or
save time for the future as well. Working and saving now, allow us to take time off for
vacations where we are able to consume the fruits of past labor without producing anything
while vacationing. Retirement is another area where people can produce a surplus now for
consumption later in life. It is only in recent times that all but the tinest minority of the
population has been able to stop working and enjoy things like vacations or retirement.
Of course, being abundant means that many take it for granted and place little value on it until
they begin to lose it as we see with some older people, and some not so old, who look back on
their lives or the recent past and regret the time they wasted. Then there are stories of people
who are suddenly faced with a terminal disease and elect to live every remaining minute to the
fullest like Jack Nicholson and Morgan Freeman in their recent movie The Bucket List. There
are also people, soldiers who live for combat, spies on dangerous missions (such as Matt
Damon's character, Jason Bourne, in the Bourne trilogy of thriller movies), etc., who love
danger and feel most alive in situations where their time on earth could end at any second.
While most of us have no desire to live on the edge, voluntarily or involuntarily, like this, it
doesn't hurt to spend a few minutes every now and then contemplating the insights of those
with terminal illnesses or who choose to live on the edge or the literature and movies about
people in these situations. Doing so, we just might come to value our own time a little more
dearly.
2.3 Time Value of Money:
The basic idea of time value of money is that a dollar today is worth more than a dollar
tomorrow. This can be shown in many ways, many people find it easiest to understand if they
think in terms of something they already know: food. For example having the money today
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allows you to buy some food immediately. Alternatively you may be willing to forgo current
consumption and wait until later to purchase your food. Thus you could lend your "food
money" to another with the promise of being paid back at some future time. Since you are
passing up food today you would demand a return sufficient to allow you to buy at least as
much food in the future that you are giving up now.
As we do not know the future this type of deal involves risks. For example the borrower may
decided to not pay you back. This is called default risk. Or the borrower may pay you back but
due to rising prices you can no longer purchase the same amount of food as you had expected
to be able to buy. As a result of these risks (you as a lender) would require a higher interest rate
to compensate for accepting the risks. However if you ask for too high of interest rates you will
not find any takers for your loan.
2.4 Present Value:
The time value of money principle says that future dollars are not worth as much as dollars
today.
You should be able to explain why! If you do not understand, please go back and reread the
above example. It is extremely important and influences almost everything we do from now
on.
In the vernacular (I love that word) what this means is that you are unwilling to make an
interest free loan. Fortunately we can compare present and future values with a rather simple
equation.
1
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This will give you the present value of a single future cash flow (CF) . In fact for ease down the
road we will generally use CF instead of FV. Future Value (FV) will be reserved for when we
are actually solving for a future value. (For example how much will we have in 5 years). A
simple Present value example follows:
What is the present value of $8,000 to be paid at the end of three years if the correct (risk
adjusted interest rate) is 11%?
2
= 8,000/(1.11)3
= 8,000/1.36
=$5,849
Note that if you had so desired you could write this equation as
3 PV = CF * (1/(1+r) t )
Which would be:
PV = 8,000 * (1/1.11)3)
=8,000 * .7312
= $5,849
The second term in equation 3, (1/(1+r)t ), is known as the present value discount factor or
present value interest factor. It is usually abbreviated PVIF(r%, N periods). You can find this
number either mathematically or from present value tables.
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Continuing our example, suppose that you were willing to make a loan where you would get
$8,000 back at the end of the third year, and $10,000 at the end of the fourth year. What is the
present value of this? Correct, you find the present value of each cash flow and then add the
present values. Thus,
PV = 8,000/(1.11)3 + 10000/(1.11)4
= $12,436.84
Generically, we can thus rewrite equation #2 as:
4
Whereby we calculate the present value of each cash flow and then sum the present values. As
you can imagine this can get quite cumbersome if we had many future cash flows. As a result
many short cuts have been devised. Chief among these is when all of the cash flows are
identical. This we call an annuity.
Examples of annuities include loan payments and certain long term contracts such as pensions,
leases, and certain sports contracts.
Example what is the present value of an annuity of $250 a year at the end of year for 6 years if
interest rates are 12%?
To solve this we could add each individual present value up, or can use the following discount
factor and then multiply by the cash flow.
5 PVIFA(r,n)=PVAF(r,n)=
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Thus if interest rates are 12% and you will receive 6 payments, the discount factor is 4.114.
Thus the Present Value (PV) of 6 payments of $250 if interest rates are 12% is
PV = PVAF(r,n) * CF
= 4.114 * $250
= $1,028.50
An important assumption in using the annuity discount factors is that the cash flows occur at
the end of each year. If the cash flows are occurring at the beginning of each year, the cash
flows are called an annuity-due. Stop and think for a second what we are doing in an annuity
due. The first cash flow occurs today. Thus the present value of the first cash flow is equal to
the cash flow. One year from now you will receive another cash flow. This second cash flow
occurs at the same time (or technically 1 day later) than the first cash flow of a regular annuity.
To the present value of an annuity due is
6 PV = CF + PVAF(r,n-1) * CF
Using the above example but assuming the first payment is made today (rather than in one
year). we can value the cash flows using the annuity-due equation.
PV = 250 + PVAF(12%, 5)* CF
= 250 + 3.6048 * 250
= $1,151.20
Note that the present value is greater than before. Why? Because the payments were all shifted
up one year, thus allowing you (the lender) to reinvest sooner and make more money.
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Alternatively if you were the borrower you are paying earlier so you lose interest that you could
have earned by keeping your money invested.
Another shortcut that you will be responsible for is a perpetuity. A perpetuity is a stream of
cash flows that goes on forever. Or at least we assume it does. This may or may not be a good
assumption (why?-forever is a very long time!) but is very easy to use.
7 PV of a perpetuity = CF/r
Note the cash flow does not have a subscript. Why? Because the definition of a perpetuity says
that all cash flows are identical.
Example: To pay for a new highway the local government sells a perpetuity that promises to
pay $1000 a year from now until the end of time. If interest rates are 10%, what is the most that
you would be willing to pay to get these future cash flows?
The basic formula is
8 FV =
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Table No-1: Future Value Factors
Example: you invest $1000 today at 10% in one year you will have 1000*(1.1)1=$1,100
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PV = CF / r
= $1000 / (.1)
=$10,000
An interesting extension of this is that you can also value a growing perpetuity. This is a series
of cash flows that grows at a constant rate. For example suppose that the above perpetuity were
promised to grow by 4% per year. Thus this year you get $1000, the next year you get
1000(1.04)=$1,040 etc.
PV=CF1 / (r-g) where CF1 is the cash flow you will receive in one year.
Example: suppose you just received $1000 and now want to sell your growing perpetuity. What
is the least you should accept for the claim on these future cash flows if the growth rate is 4%
and the correct risk adjusted interest rate is 10%.
PV =
= $1,040/(.1-.04)
= $17,333
2.5 Future Value:
Future Value is largely the same as present value but in reverse. The basic idea is the same
except here instead of determining what something is worth today, we want to find out how
much something is worth in the future. For example how much will I have if I invest today.
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In two years you will have 1,000*(1.1)2= 1,210. In three years you will have $1,331, This is
based on the implicit assumption of compound interest. Which means you earn interest on your
interest. This is a powerful concept and can lead to very large amounts when you have enough
time periods over which to accumulate more interest.
Like in the present value discussion we also can use tables to determine a future value factor.
These are abbreviated as FVIF(r,n). Thus
FV= PV * (FVIF(r,n)) If r=10%, n=3
= $1,000 * 1.331 = $1,331 which is the same we calculated above.
We also have annuities when calculating future values. These are often used in retirement
planning. For example if you invest $1000 a year for three years how much will you have at the
end of three years? If r=10%, n=3 (as before)
FV= CF * (FVAF(r,n))
= $1000 * 3.3100
= $3,310.00
How is the future value of an annuity calculated? (that is where are the numbers coming from?)
Remember the future values for single payments at 10% for 1 and 2 years these plus the last
payment of $1000 sum to $3310. Still uncertain as to the logic? Draw a timeline. Your first
payment occurs at the end of year one and earns interest for two years ($1210), the second cash
flow occurs at the end of the second year and earns interest for 1 year ($1100), while the third
cash flow occurs at the end of the third year and therefore earns no interest ($1000).
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In the days of looming recession and alleged credit crunch, competition within business has
become ever fierce. Expenses are honed to within an inch of their life and staff, unfortunately,
become a less essential commodity. Many companies who are feeling the pinch will survive the
economic pressures by getting through on a skeleton work force. There is a pecking order when
it comes to surviving such issues as belt tightening. First to go are the incidentals. Staff will
first notice putting their own hands in their pockets for tea and coffee, then the tea breaks will
be shortened to ensure time is spent more productively, followed by cleaning services being
dispensed with, putting more pressure on the remaining staff. Sometimes, companies will cut
corners with their services or products but this is counter-productive. If the quality of services
diminishes then so do the customers. More conducive to surviving the credit crunch is to make
what business you do, more effective. This certainly does not involve cutting corners but
providing an efficient service to the best of the company's abilities. One way of standing out
from your competitors is to ensure that your service or product is easily accessible,
straightforward and competitively priced.
Many companies are beginning to recognize the benefits of custom software development to
help with this process. Everything in life is now computerized. This does not, however, ensure
ease of use. Off the shelf software packages have long been used for companies to adapt their
business to the software and thus have a useable programme that works even if it doesn't quite
fit. Off the shelf software packages are cheaper than the custom software development process
but it is this 'not quite fitting' is the hiccup that could make all the difference in the face of
harsh competition. To use the services of custom software development means that the IT
solutions you are implementing will fit your business like a glove. It can grow or downsize
depending on the needs of your business at the time. This will lead to a service that is fast and
efficient, which then leads to a quicker turnover to impressed customers, leading to
recommendations, leading to a more powerful business. There are, however, drawbacks to
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custom software development. The first is the expense. It will take a whole team of analysts,
programmers, technical writers and hardware and software specialists to come up with a
bespoke piece of software. So, it would seem that in the long run custom software development
is a good thing but you need adequate funds to start with to cover the costs of development and
you also need to balance the pros and cons of this outlay within your accounts. Their needs to
be absolute clarity between software developer and customer to understand every aspect of the
customers business needs now and in the future. If there is any grey areas, these will manifest
themselves in the form of an expensive piece of bespoke software that just isn't quite up to the
job; a waste of money.
Compatibility between existing customer systems and that of their customers can sometimes
become an issue also. This can lead to frustrated customers who then choose to go elsewhere.
On the other hand, there are some excellent off the shelf software packages that are designed to
meet the needs of certain fields. Along with the much lower price tag, this ease of use can often
sway an already hard up customer to stick with what he knows, a software package that will be
easy to install. Much depends on the type of business you have. If it is a common type of
business eg plumbing supplies, then there is bound to be a quality off the shelf software
package that will accommodate your needs. But for those more unique businesses, then it is
possible that only custom software development will suffice
The importance of time management is more than to-do lists and personal organizers. The
benefits of time management extend to your personal life, career success, and achieving goals.
It is hard to overestimate the importance of time. With 24 hours a day, time is a scarce and
finite resource.
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We all know this!
We've heard and probably said ourselves to "make the best of each day" or "live each day as
though it was your last". These affirmations highlight the importance of time management - but
usually they are not enough. Here I provide time management power point demonstrations,
time management exercises and free time management sheets that you can download to boost
your time management skills today.
The choice that you take in using your time determines your effectiveness - wasting time can
lead to a wasted job or even a lack of purpose and meaning in our lives.
As Benjamin Franklin observed:
Imagine if you were given $86,400 each morning.
You are required to spend this money. You cannot save it for a rainy day or invest it for your
future.
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With 24 hours in each day, time management is about managing your activities in relation to
time.
The foundation of good time management starts with personal goal setting and developing your
priorities.
How can you make a decision on what to spend your time on if there is not a clear vision of
where you want to go?
By prioritizing what is most important to you, time management allows you to spend quality
time doing important things that add value to your life.
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Chapter-3
Research Methodology
Objectives of the Study
The study covers all the following objectives:
To present the value of time in life
To present the methods for suitable use of time
To assess the time value of money
To identify the measures on which basis we can say that Time is Money
To provide some suggestion according to research topic
Research Methodology
Methodology:
Research is defined as human activity based on intellectual application in the investigation of
matter. The primary purpose for applied research is discovering, interpreting, and the
development of methods and systems for the advancement of human knowledge on a wide
variety of scientific matters of our world and the universe. Research can use the scientific
method, but need not do so.
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The term research is also used to describe an entire collection of information about a particular
subject.
Secondary data are easily accessible, relatively inexpensive, and quickly obtained. Some
secondary data are available on topics where it would not be feasible for a firm to collect
primary data. Although it is rare for secondary data to provide all the answers to a non-routine
research problem, such data can be useful in a variety of ways. Primary data is collected for the
specific purpose of addressing the problem at hand. The collection of primary data involves
various steps. Thus obtaining primary data can be expensive and time consuming. These
suggest that primary data are those data that are collected for the particular purpose of research
in hand. The disadvantage of collecting primary data is that it is lengthy and resource and time
consuming process, but the advantage of primary data is that they are first hand information
and comparatively more reliable. A researcher originates primary data for the specific purpose
of addressing the problem at hand. The collection of primary data involves all six steps of the
marketing research process. Obtaining primary data can be expensive and time consuming.
Sampling Design:
Size of Sample: 100.
Tools used to collect data:
Primary Data
Questionnaire
Personal interview
Secondary Data:
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1. Newspapers and Journals
2. Online reference
Statistical Method Used:
Pie chart
Column diagram
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Chapter-4
Findings and Analysis
Q1. What is your gender?
Male 75%
Female 25%
Male
75%
Female
25%
Figure No-1: Gender of the respondents
The above mentioned graph shows that 75% respondents are male and 25% respondents are
female.
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Q2. What is your age group?
15-24 15%
25-34 45%
35-44 30%
More than 44 10%
15%
45%
30%
10%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
15-24 25-34 35-44 More than 44
Figure No-2: Age of the respondents
45% respondents are from 25-34 age group and 30% respondents are from 35-44 age group.
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Q3. Time is money are you believe in this statement?
Yes 95%
No 5%
Yes
95%
No
5%
Figure No-3: Believe in Statement Time is Money
95% respondents replied yes that they believe in this statement but 5% respondents replied no
that they believe in this statement.
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Q4. What is the importance of time in your life?
Very Important 40%
Important 55%
Not important 5%
Very Important
40%
Important
55%
Not important
5%
Figure No-4: Importance of time in life
40% respondents replied that time is very important in their life but 55% respondents replied
that time is important in their life.
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Q5. Do you use any schedule for your daily life?
Yes 59%
No 41%
Yes
59%
No
41%
Figure No-5: Scheduling of daily life
59% respondents replied yes that they use schedule for their daily life but 41% respondents
replied no that they use schedule for their daily life.
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Q8. Time is the valuable thing for any kind of business are you agree?
Strongly Agree 25%
Agree 49%
Neutral 15%
Disagree 9%
Strongly Disagree 2%
25%
49%
15%
9%
2%
0%
10%
20%
30%
40%
50%
60%
Strongly
Agree
Agree Neutral Disagree Strongly
Disagree
c
Figure No-8: Time is the valuable thing for any kind of business
49% respondents are agreeing with this statement but 25% respondents are strongly agreed
with this statement.
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Q9. Time waste means loss of money This is right or wrong
Right 95%
Wrong 5%
Right
95%
Wrong
5%
Figure No-9: Time waste means loss of money
95% respondents replied that it is right but 5% respondents replied that it is wrong.
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Q10. The suitable use of time is very essential in current conditions are you agree?
Strongly Agree 35%
Agree 55%
Neutral 8%
Disagree 2%
Strongly Disagree 0%
35%
55%
8%
2%0%
0%
10%
20%
30%
40%
50%
60%
Strongly
Agree
Agree Neutral Disagree Strongly
Disagree
c
Figure No-10: The suitable use of time is very essential in current conditions
55% respondents are agreeing with this statement but 35% respondents are strongly agreed
with this statement.
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Chapter-5
Conclusion
In many fields in our life, we face situations where the errors can be corrected by some sort of
retake. We can manage to sort out our mistakes as we may get another chance. But life is the
only game where there is no second chance to correct our errors, our mistakes. Once it is over,
there is nothing that can help. The time does not care about the winners and the losers. It does
never care about what a person has achieved in his life and what he has lost. Time does not care
about who succeeds in life and who fails to achieve his/her goals. Time does not entertain any
kind of excuses neither it cares about fairness or equality.
The only thing that matters is how we lived, how we fought, how we played the game. Every
step needs to be taken at right moment. Time does never show partiality, it gives everyone
equal chance to win, it offers opportunity but also demands a sense of urgency, urgency to
wake up and act at the very moment. We should always keep in mind that time is money and
no one can afford losing it. Time has given everyone equal chance to win, the proof of this can
be read in history, there are different chapters in the history where many individuals have
written there names with golden ink, because they were successful, because they did everything
on the correct time. They never let an opportunity pass by. All this is to indicate only one thing
and that is nothing but. we all should take care to act on the right moment. We should be
constantly aware of the value of each and every moment of our lives - moments that seems so
insignificant that there loss often goes unnoticed. Perhaps God knew about us, and he gave us
more time. We still have all the time we need. We still have lots of chances, lots of
opportunities lots of days, months, and years to show what we can do.
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Chapter-6
Recommendations
It never seems like we have enough time in life, despite hours upon hours available to us each
day. Where does all the time go? Better yet, how can we use our time better and what are some
of the ways to do so? Continue reading to find out.
The first step toward better time management is to identify the activities which are sucking
away at your valuable time. Once you create a list of these time wasters, begin the process of
weening off each of these activities and replace them with those that are productive.
A goal can help us strive toward excellence but one fatal flaw when developing goals is to
make it utterly unobtainable and a compete waste of time as we become distracted and
unfocused. The correct way to set a goal is to go outside your comfort zone but break down the
entirety into manageable chunks which you can reward yourself after each milestone.
Thanks in many ways to social media, many people have multiple accounts littered across the
net. Each additional account becomes another chore to check on a regular basis. Additionally,
with email, banking and many other accounts, these "few seconds" checking each will quickly
add up to hours.
To manage your time better, try to create a set schedule where you only check your profiles and
accounts at certain times of the day and afterward, leave them alone.
There are many activities which we do each day that could easily be fit together: answering
emails, returning phone calls, writing articles. Because most of these tasks of responding and
working often come at different intervals, we always break up our time.
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Instead of immediately responding to an alert, batch your work together so you only spend a
certain allotted time to finish each of these tasks - once the time is done, don't check it until the
next day.
We all have a lot of work to do but it always seems like we take on additional projects even
when we're overloaded. It could be as a favor or to stay busy but the more projects you take
upon yourself the more likely you'll eventually burn out. Start learning to say "no"
when additional work arrives. Tell others that you're already busy and would like to but simply
don't have the time. Learning to say no will help you keep focus and allow you to manage your
time
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References/Bibliography
C, Koschate N and Hoyer W D (2005) High quality time management services? A
study of the relationship between time and money. J Mktg 69: 84-96
Ofir C and Simonson I (2001) In search of time value for life: The effect of expecting to
evaluate on time value. J Mktg Res 38: 170-182
Vernoer P C (2003) Understanding the effect of time management efforts on daily life.
J Mktg 67: 30-45
Reinartz W, Krafft M, and Hoyer W D (2004) The time management process: Its
measurement and impact on life. J Mktg Res 42: 293-305
Blanchflower, D. G., A. J. Oswald, and A. Stutzer (2001). Latent Entrepreneurship
across Nations.European Economic Review 45 (4-6), 680691.
Brenner, M., D. Fairris, and J. Ruser (2004). Flexible Work Practices and Occupational
Safety and Health: Exploring the Realtionship Between time and money. Industrial
Relations: A Journal of Economy and Society 43 (1), 242266.
Fairris, D. and M. Brenner (2001). Time value of money: Is There a Connection?
Journal of Time Research 22 (1), 1528.
Freeman, R. B. and M. M. Kleiner (2000). Who Benefits Most from Employee
Involvement: Firms or Workers?American Economic Review 90 (2), 219223.
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Appendices
Questionnaire
Q1. What is your gender?
Male
Female
Q2. What is your age group?
15-24
25-34
35-44
More than 44
Q3. Time is money are you believe in this statement?
Yes
No
Q4. What is the importance of time in your life?
Very Important
Important
Not important
Q5. Do you use any schedule for your daily life?
Yes
No
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Q6. Do you think that time table is an effective way in case of time saving?
Yes
No
Q7. Do you waste your time in doing the unnecessary things?
Yes
No
Q8. Time is the valuable thing for any kind of business are you agree?
Strongly Agree
Agree
Neutral
Disagree
Strongly Disagree
Q9. Time waste means loss of money This is right or wrong
Right
Wrong
Q10. The suitable use of time is very essential in current conditions are you agree?
Strongly Agree
Agree
Neutral