Question

A dollar in hand today is worth_______(less than/more than/equivalent) a dollar to be received in the future because if you had it now you could invest that dollar and___________ (pay/earninterest.)Of all the techniques used in finance, none is more important than the concept of time value of money (TVM), also called _________(capital budgetingcash budgetingdiscount cash flow (DCF)) 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

more than

earn interest

discount cash flow (DCF)

Step-by-step explanation:

The concept of future value represents the amount that a lump sum or series of cash flows will achieve after a given period when compounded at an interest rate. This means that a dollar in hand today is worth more than a dollar to be received since it can be applied to earn interest.

The time value of money, which allows us to evaluate different investments, is also known as discount cash flow (DCF).