Present Value
Present Discount Value
The current worth of an expected future payment or income stream, discounted at an appropriate interest rate. A dollar today is worth more than a dollar tomorrow, because today's dollar can be invested to earn a return.
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Origin
The intuition that money now is worth more than money later has roots in medieval scholastic thought, but the formal mathematics emerged with Irving Fisher's The Nature of Capital and Income (1906), which showed how to discount future income streams using interest rates.
Updated February 22, 2026