TRUE VALUE is the amount that a buyer is finally willing to pay.

DISCOUNTED VALUE is the present value of the sum of future payments after they has been discounted back. The higher the discount rate used, the lower the present value of the future sum.

80 - 20 RULE (Pareto Principle/Law) is a general rule of thumb in business that says that 20% of the items produce 80% of the activity, while 20% of the product line produces 80% of the sales, 20 % of the customers generate 80% of the complaints, and so on. In evaluating any business situation, look for the small group which produces the major portion of the transactions you are concerned with. This rule is not exactly accurate, but it reflects a general truth, nothing is evenly distributed.

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