Money received today is worth more than the same amount of money received in the future. This is true because
A) money received today can grow at a compounded rate.
B) inflation will devalue future dollars.
C) generally, goods and services will cost more in the future.
D) All of these.

Question

Quizplus · Accepted Answer

All of the options provided are correct reasons why money received today is considered to be worth more than the same amount received in the future. Money can grow through investment (A), inflation reduces the purchasing power of money over time (B), and the general trend of rising costs for goods and services (C) all contribute to the principle of the time value of money.

Money Received Today Is Worth More Than the Same Amount