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Week 4-Short Answer Assignment

Week 4-Short Answer Assignment

Q Instructions Please, review the question below, and write a 2-3 paragraph essay, answering the question in your own words. Use any outside sources you consider relevant. Explain in your own words the concept of the time value of money.

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The time value of money can be defined as money you have at present that will benefit more than the identical sum of money concerning its earning capacity. This essential rule of finance grips that any amount of money is valued faster than it received through the money we can earn interest. The amount received or paid at present will earn a short-term interest period and raise capacity during the period (Gardner, 2004). There are two approaches in which TVM is helpful to corporate managers;