If you are presented with an offer to accept payment now or a greater amount in the future, you would use (assuming you can invest the money at a known rate)
A) present value of $1.
B) future value of $1.
C) present value of an annuity.
D) Both A and B can be used for this analysis.

Question

Quizplus · Accepted Answer

To decide whether to accept payment now or a greater amount in the future, you can use both the present value of $1 (to determine the value of the future payment in today's dollars) and the future value of $1 (to determine how much the current payment could grow to in the future). Both methods help in comparing the value of money over time, taking into account a known investment rate.

If You Are Presented with an Offer to Accept Payment