The time value of money can be best described as
A)a dollar today is worth more than a dollar tomorrow.
B)the basis on which net present values are calculated.
C)the basis on which internal rates of return are calculated.
D)All of the above

Question

Quizplus · Accepted Answer

The time value of money refers to the concept that a dollar today is worth more than a dollar tomorrow, as it can be invested and earn interest. This concept is the basis on which both net present values and internal rates of return are calculated in financial analysis. Therefore, all options are correct.

The Time Value of Money Can Be Best Described as