To critically think about: The investors’ willingness to pay $24,099 in return of $100,000, after 30 years. Introduction: The time value of money implies that the cash in hand at present has a higher value than the cash receipt promised in the future. Hence, a person needs more money in the future to buy the same product at present.

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Chapter 4, Problem 8CQ

Summary Introduction

To critically think about: The investors’ willingness to pay $24,099 in return of $100,000, after 30 years.

Introduction:

The time value of money implies that the cash in hand at present has a higher value than the cash receipt promised in the future. Hence, a person needs more money in the future to buy the same product at present.

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