The time value of money theory consists in four beliefs: (1) Investment risk is important; (2) money today is worth more than money tomorrow; (3) inflation must be considered when making investment decisions; and (4) investment opportunity costs must be considered.

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Business

Ashleigh Blackwell

24 October, 18:48

The time value of money theory consists in four beliefs: (1) Investment risk is important; (2) money today is worth more than money tomorrow; (3) inflation must be considered when making investment decisions; and (4) investment opportunity costs must be considered.

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Porter · Answer 1

The four beliefs are true. But accuracy is demanded

Explanation:

1 Investment risk is important ir order to estimate the likelihood of occurrance of losses in the future.

2. money today is worth more than the same amount of money tomorrow.

3. inflation must be considered when making investment decisions, because makes money lose their value in the future.

4. investment opportunity costs must be considered. Is necessary to compare investments with financial products or other commercial activities.