Why Is It Usually Necessary to Use the Time Value

question 79

Multiple Choice

Why is it usually necessary to use the time value of money when performing a cost-benefit analysis?

• A)In most investment projects costs are incurred up front, but benefits are provided in the future.
• B)Although costs and benefits generally occur concurrently, the benefits will accrue value over time, due to interest.
• C)For practical purposes, a dollar today may be considered to be equal to a dollar at some future time.
• D)For an investment project to be considered, costs must have a higher dollar value from benefits.

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