The concept of time value of money is that* Note- I am not satisfy give downvote The cash flows that occur earlier are more valuable than cash flows that occur later The cash flows that occur earlier are less valuable than cash flows that occur later The longer the time cash flows are invested, the more valuable they are in the future The future value of cash flows are always higher than the present value of the cash flows

The concept of time value of money is that* Note- I am not satisfy give downvote The cash flows that occur earlier are more valuable than cash flows that occur later The cash flows that occur earlier are less valuable than cash flows that occur later The longer the time cash flows are invested, the more valuable they are in the future The future value of cash flows are always higher than the present value of the cash flows

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter16: Statement Of Cash Flows

Section: Chapter Questions

Problem 9MC: What is the effect on cash when current noncash operating assets decrease? A. Cash increases by the...

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What is the effect on cash when current noncash operating assets decrease? A. Cash increases by the same amount. B. Cash decreases by the same amount. C. Cash decreases by twice as much. D. Cash does not change.
The concept of time value of money is that* •The cash flows that occur earlier are more valuable than cash flows that occur later •The cash flows that occur earlier are less valuable than cash flows that occur later •The longer the time cash flows are invested, the more valuable they are in the future •The future value of cash flows are always higher than the present value of the cash flows
Consider a company with a Reddington Immune cash flow stream of assets and liabilities. The asset payments all occur before the liability payments. What can you say about the present value of the entire cash flow stream if the interest rate increases from its current rate? a. We cannot say anything about the sign of the new present value. b. The new present value is negative. c. The new present value is positive. d. The new present value is zero.
Which statement characterizes the time value of money concept? A) The future value of a present dollar is less than one dollar.B) The present value of a future dollar is less than one dollar.C) The timing of cash flows is not relevant to decision making.D) None of the above
An increase in the discount rate will______ O a. Reduce the present value of future cash flows O b. Increase the present value of future cash flows c.Have no effect on net present value Od. Compensate for reduced risk
An increase in the discount rate will____ a. Reduce the present value of future cash flows b. Increase the present value of future cash flows c. Have no effect on net present value d. Compensate for reduced risk
If we say that a non-cash asset has high liquidity we are indicating that The assets can be converted to cash quickly The assets can be converted to cash at or near fill value The asset can be converted to cash with a large discount
If current liabilities increase, what is the effect on cash? What about a decrease in current liabilities?
The net present value: is equal to the initial investment when the internal rate of return is equal to the required return. is unaffected by the timing of an investment's cash flows. ignores cash flows that are distant in the future. decreases as the required rate of return increases.
Which of the following is not a factor in explaining why the present value of a future dollar is less than one dollar?A. InterestB. Inflation C. Risk of failure to receive expected cash inflows D. Historic cost
What is the Time Value of Money (TVM)? Specifically, how do inflation and compound interest effect the value of the cash you have on hand or hope to accumulate?
The principal of the time value of money is probably the single most important concept in financial management. One of the most frequently encountered applications involves the calculation of a future value. A. The process for converting present values into future values is called . This process requires knowledge of the values of three of four time-value-of-money variables. Which of the following is not one of these variables? The inflation rate indicating the change in average prices The duration of the investment (N) The interest rate (I) that could be earned by invested funds The present value (PV) of the amount invested B. Investments and loans base their interest calculations on one of two possible methods: the interest and the. interest methods. Both methods apply three variables—the amount of principal, the interest rate, and the investment or deposit period—to the amount deposited or invested in order to compute…