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29 July, 20:12

There are four basic principles of finance. Which principle correctly describes the following statement: "A dollar today is worth more than a dollar received in the future. Conversely, a dollar received in the future is worth less than a dollar received today"?

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  1. 29 July, 21:21
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    Time value of money

    Explanation:

    The ability of money kept in a savings deposit to earn interest over time and the increase in the total interest in line with the length of time, brought us to a conclusion that an amount of money to be received now, that is in the present, is worth more than the same amount if received in the future.

    The increase in the value of money as a result of interest earned on it, increases the value of money, this concept is what is referred to time value of money.
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