Which of the following is not a factor in explaining why the present value of a future dollar is less than one dollar?

Question

Quizplus · Accepted Answer

Historic cost is not a factor that affects the present value of a future dollar. Inflation reduces the purchasing power of money over time and therefore decreases the present value of a future dollar. Interest represents the cost of borrowing money or the return earned on investments and can increase the present value of a future dollar. Risk of failure to receive expected cash inflows can also decrease the present value of a future dollar as it increases uncertainty about whether the expected cash inflows will actually be realized.

Which of the Following Is Not a Factor in Explaining