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The fact that one should not add or subtract money unless it occurs at the same point in time is an illustration of what concept

User Locksfree
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Answer:

B. Time value of money

Step-by-step explanation:

A) Economy of scale

B) Time value of money

C) Pareto principle

D) Marginal return

Time value of money is a concept which illustrate that one should not add or subtract money unless it occurs at the same point in time.

Time value of money is also known as present discounted value. The time value of money illustrate that people will prefer to receive an amount of money today rather than receive the same amount of money at a later time (future).

This is because money tends to increase in value over a period of time though interest rate. For example, if a person receives $100 today and deposit the money in a savings account at 5% interest rate quarterly. The $100 of today will be worth more than than a $100 of next year because of the compounded interest rate.

User Carlos Alves Jorge
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