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Which of the following concepts is true regarding the time value of money? Present value represents the current value of a future amount of money
Which of the following concepts is true regarding the time value of money?
- Present value represents the current value of a future amount of money given a specified rate of return.
- When time periods are less than one year, the time value of money may be ignored.
- When time periods are longer than one year, assets and liabilities are valued at the present value of future payments.
- When the present value is more than the amount which will ultimately be paid/received, the difference is called a "discount".
Multiple Choice
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I and II only are true
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All of the above statements are false
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All of the above statements are true
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I and IV only are true
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I, II and III are true but IV is false
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