Question

A dollar in hand today is worth a dollar to be received in the future because if you had it now you could invest that dollar and interest. Of all the techniques used in finance, none is more important than the concept of time value of money (TVM), also called analysis. Time value analysis has many applications including retirement planning, stock and bond valuation, loan amortization, and capital budgeting analysis. Time value of money uses the concept of compound interest rather than simple interest.

Answer 1

The correct sentence is: A dollar in hand today is worth MORE THAN a dollar to be received in the future because if you had it now you could invest the dollar and EARN interest.

The MONEY in your pocket, the cash in your hand, is more valuable than the one you don't really have. As someone once said, you cannot buy a beer tonight with what you will earn tomorrow.