Asked by Maria del Mar Ribas on May 09, 2024
Verified
The concept that a dollar received today is worth more than a dollar received tomorrow is referred to as the:
A) Present value.
B) Simple interest value.
C) Compound value.
D) Time value of money.
E) Future value of money.
Time Value of Money
The concept that a sum of money is worth more now than the same amount in the future due to its potential earning capacity.
Present Value
The worth today of money expected to be received in the future or sequences of cash inflows, utilizing a specific return rate.
Compound Value
The future value of an investment, including the principal and the compounded interest over time.
- Acknowledge the value of time in monetary terms when making financial decisions.
Verified Answer
ML
Miles LatimerMay 12, 2024
Final Answer :
D
Explanation :
The concept that a dollar received today is worth more than a dollar received tomorrow is referred to as the Time value of money. This principle highlights the preference for receiving money now rather than later, due to potential earning capacity.
Learning Objectives
- Acknowledge the value of time in monetary terms when making financial decisions.