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Topic: Discount factor

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	Kirk's Market Thoughts: Discount cash flow analysis
		Then you have an annual discount factor in the next column perhaps getting larger as you go out in time to reflect lower visibility and thus higher risk.
		What is really interesting is if you don't use a discount factor, then the number goes to infinity any time the stock grows faster than inflation.
		Now use this discount factor and change growth rates from 8% to 9% or even 15%….
	www.suite101.com /discussion.cfm/investing/7235/150336 (510 words)

	Discount - Wikipedia, the free encyclopedia
		The discounted value of a cash flow is determined by reducing its value by the appropriate discount rate for each unit of time between the time when the cashflow is to be valued to the time of the cash flow.
		The discount rate used in financial calculations is usually chosen to be equal to the cost of capital.
		The discount factor', P(T), is the number by which a future cash flow to be received at time T must be multiplied in order to obtain the current present value.
	www.wikipedia.org /wiki/Discount (334 words)

	Discount (Site not responding. Last check: 2007-10-10)
		In finance, discounting is the process of finding the currentvalue of an amount of cash at some future date, and along with compounding cash form the basis of time value of money calculations.
		The discounted value of a cash flow is determined by reducing its value by the current discount rate foreach unit of time between the time when the cashflow is to be valued to the time of the cash flow.
		The discount factor', P(T), is the number by which a future cash flow to be received at time T must bemultiplied in order to obtain the current present value.
	www.therfcc.org /discount-28709.html (311 words)

	Discount (Site not responding. Last check: 2007-10-10)
		In finance discounting is the process of finding the value of an amount of cash at future date and along with compounding cash the basis of time value of money calculations.
		The discounted value of a cash flow is determined by reducing its value the current discount rate for each unit of time between time when the cashflow is to be to the time of the cash flow.
		The discount factor ' P(T) is the number by which future cash flow to be received at T must be multiplied in order to the current present value.
	www.freeglossary.com /Discount (749 words)

	The Shadow of the Future: Discount Rates, Later Generations, and the Environment
		OMB uses a ten percent annual "discount rate" to convert future regulatory costs and benefits into their "present value."[3] Because government regulation of carcinogens cannot be expected to affect the cancer rate for twenty or thirty years[4], OMB's choice of discount rates has dramatic implications for regulatory policy.
		One argument in favor of discounting benefits to future generations is that, without discounting, the present generation would sacrifice all consumption, because the total benefits to infinite future generations will always exceed any cost to a single current generation[96].
		Using a zero discount rate for lives reveals that the present value of the future life saved is $5 million (because we are applying a zero discount rate), while the present value of he regulatory cost is only $4.5 million.
	www.ciesin.org /docs/010-291/010-291.html (17009 words)

	Discount factor - Hutchinson encyclopedia article about Discount factor (Site not responding. Last check: 2007-10-10)
		Discounting is a form of competition used by companies to increase sales and market share.
		Discounts can also be given for buying in bulk, and this then becomes a source of economies of scale for the buying organization.
		The term is also used to describe the equivalent present value of a sum payable or receivable in the future; for example, if the rate of interest is 5% and the sum of £105 is payable in a year's time, then its discounted present value is £100.
	encyclopedia.farlex.com /Discount+factor (164 words)

	Real Cost (Site not responding. Last check: 2007-10-10)
		Discount factor is the same as rate of return, except working backwards from the income stream.
		You use the rate of return to determine what X amount of money will produce in income over the next 50 years; you use the discount factor to determine what needs to be invested today to produce Y amount of income over the next 50 years.
		Using the same variables (discount factor, desired income, and time span) the present value of this annuity will equal the cost.
	www.halperngroup.com /Archive/real_cost.htm (172 words)

	Discount Air (Site not responding. Last check: 2007-10-10)
		In finance, discounting is the process of finding the current value of anamount of cash at some future date, and along with compounding cash form the basis of time value of money calculations.
		The discounted value of a cash flow is determined by reducing its value by the current discount rate for each unit of time between the time when the cashflow is to be valued to the time of thecash flow.
		The discount factor', P(T), is the number by which a future cash flow to be received at time T must be multiplied inorder to obtain the current present value.
	www.elusiveeye.com /side7603-discount-air.html (397 words)

	discount factor
		Factor analysis A statistical procedure that seeks to explain...
		Factor portfolio A well-diversified portfolio constructed to have a beta of 1.0 on one factor and a beta of zero on any other factors.
		Discounted cash flow (DCF) Future cash flows multiplied by discount factors to obtain present values.
	www.idrassociate.org /5629kp_g-6.html (695 words)

	Net Present Value Discount Factor (Site not responding. Last check: 2007-10-10)
		Discounting is the process of converting a future value of money into a present value equivalent.
		At annual interest rate i, annual discount factor v, show that the present value is...
		year 0 the discount factor is 1 because year 0 is the 'present time' in present value calculations.
	www.uk-shopping-warehouse.co.uk /Net_Present_Value_Discount_Factor (565 words)

	Verizon WV, et al. v. Bureau of Employment Programs, etc., No 30899
		Allocation of a portion of the amortization of discount to self-insured employers is properly included as a part of the expense of administration of the workers' compensation fund, in conformance with the rate-making provisions of Title 85, Series 9 of the West Virginia Code of State Regulations and the standards prescribed by the Legislature.
		It is clear to this Court that the methodology employed to calculate the amortization of the discount factor involved a detailed effort to identify all relevant factors that contributed to the Fund's financial situation.
		Those factors are: (1) the economic impact of the regulation on the claimant; (2) the extent to which the regulation has interfered with reasonable investment-backed expectations; and (3) the character of the government action.
	www.state.wv.us /wvsca/docs/spring03/30899.htm (12061 words)

	js-732: Testimony of the Honorable Peter R. Fisher Under Secretary for Domestic Finance U.S. Department of the ...
		The present value of a benefit payment due during a particular future year is calculated by applying a discount factor to the dollar amount of that payment.
		Although some discounting schemes use the same discount rate to compute the present value of payments for all future years, it is no more difficult to compute the present value using different discount rates for each future year.
		Because discounting pension payments using a yield curve is already considered a best practice in financial accounting, large sponsors are almost certainly making these computations now or know how to make them.2 Sponsors certainly know what their expected future pension cash flows are.
	www.ustreas.gov /press/releases/js732.htm (4778 words)

	Zero Curve Methodology
		For each date, the discount factor (present value of $1) and a continuously compounded zero rate are calculated using the methodology below in the samples:
		Continuously compounded zero rates are derived from these discount factors using the formula in II.
		Discount factors out along the bond + swap spread strip (2 year + in Canada) are computed recursively to exact dates in half year increments using:
	www.powerfinance.com /help/Zero_Curve_Methodology.htm (584 words)

	Medicare Prescription Drug Card - Revised Policy
		To prevent households from experiencing any reduction in their food stamp benefits as a result of receiving the discount drug card, the Department is requiring that the discounts and subsidy a household receives through the drug discount card be treated as standard medical expenses to be used in determining the household’s medical expense deduction.
		In this way, households using the drug discount card will continue to receive a medical deduction for the money they were spending on prescription drugs prior to receiving the drug card.
		That is, the State agency must determine the cardholder’s actual medical expense by multiplying the cardholder’s current out-of-pocket expenses by the discount factor of 1.25.
	www.fns.usda.gov /fsp/rules/Memo/04/061804.htm (1354 words)

	Discounted Cash Flow - Dividend Discount Calculations - from Valuation Technologies
		Future cash flows are discounted by the rate commensurate with the risk level of the investment.
		Press the "Discount" button; the Discount Factor column will be computed, finding the present value of $1.00 received in the future year.
		Dividend(1) is the current dividend, the Discount Rate is the Cost of Capital for Equity (since we are focusing on Dividends), not the Weighted Average Cost of Capital.
	www.valtechs.com /r2.shtml (1864 words)

	First Hitting Time and Expected Discount Factor (Site not responding. Last check: 2007-10-10)
		In the option-games applications, is frequently used the expected discount factor, in order to calculate the expected present value of one option that will be exercise at a random time T*.
		T* So, in many situations the expected discount factor is more useful than the expected first hitting time, because the former can exists (be a finite number) even without existing a finite number for the expected first hitting time (if we have some paths with T* = infinite).
		The maximization of the project is a trade-off between waiting for a higher value of the project V and the discount factor (higher as earlier we exercise the option).
	www.puc-rio.br /marco.ind/hittingt.html (7666 words)

	Medicare Prescription Cards – Q&As
		The discount and any portion of the $600 credit used for prescription drugs will be treated as incurred medical expenses for purposes of the Medicaid “spend-down”.
		Since this amount is less than the $300 that the individual incurred before he started using the discount card, if the individual can demonstrate that his expenses totaled $300 prior to using the card, the eligibility worker can use $300 when calculating the individual’s benefit amount.
		This would run contrary to the MMA, which states that the discount and credit shall not be treated as benefits or otherwise considered in determining an individual’s eligibility for or the amount of benefits under any other federal program.
	www.fns.usda.gov /fsp/rules/Memo/04/questions.htm (4745 words)

	JS-919: Testimony of Mark J. Warshawsky Acting Assistant Secretary for Economic Policy U.S. Department of the ...
		H.R. 3108’s proposed discounting method for the next two years is broadly consistent with the Administration’s proposal over the same time frame.
		It is also important to understand that the discount rate used does not change the actual obligation -- the liability is what it is. Choosing the proper discount rate gives us an accurate measure in today’s dollars of future benefit payments; it does not change those payments.
		The notice invites comments on methods of projecting mortality and on factors, in addition to age and year of birth, that might be appropriately reflected in any new tables that may be adopted.
	www.ustreas.gov /press/releases/js919.htm (4466 words)

	Choosing the Discount Factor for Estimating Economic LGD
		Which discount rate to use on cash received post-default is a question that is the subject of considerable disagreement amongst practitioners and banking supervisors.
		Empirically, the required rate of return on defaulted corporate bonds is shown to be similar in magnitude to the yield on BB rated debt.
		For defaulted small and medium enterprise (SME) bank loans, the mean discount rate is found to be similar, on average to the contract rate pertaining at the time of default.
	www.defaultrisk.com /pp_recov_18.htm (220 words)

	[No title]
		The first is to argue that the difficulties)J 53 522 :M.096.01(associated with discounting, equity and uncertainty all arise from a common source.
		T)J 105 639 :M.133.013(he first is the problem of discounting the effects of current decisions on future)J 53 663 :M.544.054(generations.
		Nevertheless, for typical)J 53 447 :M 1.337.134(projects, increasing the discount rate in response to risk has the right general effect,)J 53 471 :M.367.037(namely that fewer risky projects are undertaken.
	www.uq.edu.au /economics/johnquiggin/JournalArticles97/Sustain97.ps (7017 words)

	Discount - Open Encyclopedia (Site not responding. Last check: 2007-10-10)
		The discounted value of a cash flow is determined by reducing its value by the current discount rate for each unit of time between the time when the cashflow is to be valued to the time of the cash flow.
		Some adjustment may be made to the discount rate to take account of risks associated with uncertain cashflows.
		For a fixed continuously compounded discout rate r we have
	www.open-encyclopedia.com /Discounted (311 words)

	resume 2002.97 (Site not responding. Last check: 2007-10-10)
		On optimal growth models when the discount factor is near 1
		The aim of this paper is to fulfill the gap between intertemporal growth models when the discount factor is close to one and when it equals one.
		We show that the value function and the policy function are continuous with respect both to the discount factor
	mse.univ-paris1.fr /Cahiers2002/2002097B.htm (152 words)

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	www.smilehappy.net (1547 words)

	FRB Minneapolis Research Archive - Assessing Specification Errors in Stochastic Discount Factor Models (Site not responding. Last check: 2007-10-10)
		ABSTRACT: In this paper we develop alternative ways to compare asset pricing models when it is understood that their implied stochastic discount factors do not price all portfolios correctly.
		Unlike comparisons based on chi-squared statistics associated with null hypotheses that models are correct, our measures of model performance do not reward variability of discount factor proxies.
		We demonstrate empirically the usefulness of methods in assessing some alternative stochastic factor models that have been proposed in asset pricing literature.
	www.mpls.frb.org /research/sr/sr167.html (134 words)

	Defense Procurement and Acquisition Policy - Contract Pricing Reference Guide
		APPENDIX A-1, Discount Factors -- Nominal Rates, End-Of-Year Payments
		APPENDIX A-2, Discount Factors -- Nominal Rates, Mid-Year Payments
		APPENDIX A-4, Discount Factors -- Real Rates, Mid-Year Payments
	www.acq.osd.mil /dpap/contractpricing/vol2app1.htm (82 words)

	Dynamics of Open Economy Models: What Is the Role of the Discount Factor?
		This paper examines the dynamic implications of the use of an endogenous discount factor in small open economy models.
		We first present a stochastic dynamic model of a small open economy with an endogenous discount factor.
		Our results suggest that while the use of an endogenous discount factor helps researchers to define a stable stochastic steady state, the dynamic implications of the two models can be quite similar depending on the parameters of the model.
	ideas.repec.org /p/sce/scecf9/1231.html (274 words)

	»»Discount-factor Reviews««
		Compound interest and discount factor tables for appraisers : the six functions of one dollar = Tables d'intérêt composé et de facteurs d'actualisation à l'intention des évaluateurs : les six fonctions d'un dollar
		Energy price indices and discount factors for life-cycle cost analysis (SuDoc C 13.58:85-3273-)
		Energy prices and discount factors for life-cycle cost analysis (SuDoc C 13.58:)
	www.financial-book-review.com /Direct-quote/Discount-factor (171 words)

	FRA_df() function (Site not responding. Last check: 2007-10-10)
		A discount factor is defined as the present value of $
		The discount factor curve starts at a value of $1 today, and diminishes
		The first element of this array must be 1.0.
	www.powerfinance.com /help/FRA_df___function.htm (74 words)

	SSRN-Portfolio Efficiency and Discount Factor Bounds with Conditioning Information: A Unified Approach by Abhay ...
		mean-variance efficiency and discount factor bounds in the presence of conditioning information.
		We extend the Hilbert space framework of Hansen and Richard (1987) to obtain new characterizations of the efficient portfolio frontier and variance bounds on discount factors, as functions of the conditioning information.
		Abhyankar, Abhay, Basu, Devraj and Stremme, Alexander, "Portfolio Efficiency and Discount Factor Bounds with Conditioning Information: A Unified Approach" (August 2002).
	www.ssrn.com /abstract=301859 (337 words)

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