The time value of money principle implies that all other things being equal,investments that produce profits faster are preferred over those that produce more distant profits.

Question

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The time value of money principle states that a dollar received today is worth more than a dollar received in the future, as long as the dollar can earn interest or other profits in the meantime. Therefore, investments that produce profits faster are preferred over those that produce more distant profits, as they allow for greater compounding and growth of the investment over time.

The Time Value of Money Principle Implies That All Other