Which of the following statements is true?
A) A dollar received today is worth more than a dollar to be received in the future because future dollars are not affected by inflation.
B) A dollar to be received in the future is worth more than a dollar received today because of the positive impact of rates of return.
C) A dollar received today is worth more than a dollar to be received in the future because funds received today can be invested to earn a return.
D) A dollar to be received in the future is worth more than a dollar received today because it would have less risk associated with it.
Answer: C
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FIN202 Chapter 5
- Which of the following statements is false with respect to the present value of a future amount?
- Which of the following statements is true?
- Your aunt is looking to invest a certain amount today. Which of the following choices should she opt for?
- Using lower interest rates will
- Using lower discount rates will
- Using higher interest rates will
- Using higher discount rates will
- The Rule of 72
- Which one of the following statements is NOT true?
- Which one of the following statements is NOT true?
- The process of converting future cash flows to what its present value is
- The process of converting an amount given at the present time into a future value is called
- Which one of the following statements is true?
- Future value measures
- Which one of the following statements is NOT true?
- Which one of the following statements is NOT true?
- The time value of money refers to the issue of
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