The time value of money implies that one dollar today is worth more than one dollar tomorrow,due primarily to the opportunity cost of foregoing consumption today

Question

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The time value of money theory states that the present value of money is worth more than the same amount in the future due to the opportunity cost of investing and earning returns, inflation, and risk factors. Therefore, one dollar today is worth more than one dollar tomorrow as it can earn interest or be used for consumption today.

The Time Value of Money Implies That One Dollar Today