The concept time value of money indicates
A) the value of a dollar decreases over time as prices increase.
B) the prices of goods and services will fluctuate over time due to inflation and higher costs of production.
C) monetary systems tend to become more sophisticated over time.
D) a dollar received today is worth more than a dollar received a year from today.

Question

Quizplus · Accepted Answer

The concept of time value of money implies that money in hand today is worth more than the same amount to be received in the future, due to its potential earning capacity and the effects of inflation. Therefore, delaying receipt of a dollar reduces its current purchasing power.

The Concept Time Value of Money Indicates