Time Value of Money Is Important Because

question 117

Multiple Choice

Time value of money is important because

• A) you do not want to wait a long time to get paid.
• B) deflation eats away at the value of a dollar.
• C) the present value of future cash flows is affected by inflation.
• D) time value of money is not as important to a person's finances as budgeting.

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Definitions:

Book Values

The net value of a company's assets as recorded on the balance sheet, calculated by subtracting liabilities from the total assets.

Market Values

The valuation at which an asset could be bought or sold in a current market, regardless of its original cost or book value.

Financial Manager

A financial manager is responsible for managing a company's financial planning, funding, and investment strategies to support the organization's goals.

Terminal Loss

The loss realized upon the sale or disposal of an asset at the end of its useful life.