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    Question

    In finance terminology the “Time value of money”

    signifies that:
    A A unit of money obtained today is worth more than a unit of money obtained in future Correct Answer Incorrect Answer
    B A unit of money obtained today is worth less than a unit of money obtained in future Correct Answer Incorrect Answer
    C There is no difference in the value of money obtained in future Correct Answer Incorrect Answer
    D The taxes are bound to increase as a result of inflation Correct Answer Incorrect Answer
    E A unit of money obtained today is same as a unit of money obtained in future Correct Answer Incorrect Answer

    Solution

    Yes, that is correct. The time value of money is the concept that a unit of money today is worth more than the same amount of money in the future, due to the potential earning capacity of money over time. This means that money has a "time value" or "time cost," which reflects the potential return that can be earned by investing or using the money today.

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