Which of the Following Concepts Represents Time Value of Money

question 28

Multiple Choice

Which of the following concepts represents time value of money?

• A)the concept that money becomes obsolete over time
• B)the concept that money earns income over time
• C)the concept that money loses its purchasing power over time
• D)the concept that money can be converted into other currencies over time

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Definitions:

Future Value

Future value is the value of a current asset at a specified date in the future based on an assumed rate of growth over time.

Single Amount

A lump-sum value; referring to a financial transaction or an accounting entry that involves only one amount rather than multiple payments or amounts.

Concept

An abstract idea or a general notion representing something, often used as a foundational principle or theory.

Semiannual Deposits

Payments or savings contributions made twice a year into a particular account or investment.