Final answer:
The statement that present values have the value additivity property is true. In finance, the total present value of multiple cash flows can be calculated by adding the present values of each cash flow individually, analogous to the commutative property of addition in mathematics.
Step-by-step explanation:
The statement that present values have the value additivity property is true. In finance, value additivity refers to the principle that the value of a whole is equal to the sum of the values of its parts. This means that when computing the present value of multiple cash flows, each individual present value can be added together to get the total present value of the combined cash flows.
For instance, if you are given the present values of different future amounts that you will receive at different times, you simply add up all the present values for the different time periods to determine the combined present value. This is analogous to the commutative property of addition with ordinary numbers, where the order of adding numbers does not affect the sum (e.g., 2 + 3 is the same as 3 + 2).