The time value of money concept becomes less critical as the prime rate increases.

Name: The time value of money concept becomes less critical as the prime rate increases.
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Question

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The time value of money concept becomes more critical as the prime rate increases because higher interest rates increase the opportunity cost of not receiving and investing funds now. Therefore, the importance of earning interest on invested funds grows as the prime rate increases, making the time value of money more critical.

The Time Value of Money Concept Becomes Less Critical as the Prime