Time value of money

Question 1

Time value of money

Answer 1

2. Dollar today is worth more than dollar in the future because of the ability to invest the dollar and earn a return.

Question 2

Delaying tax is

Answer 2

second best thing

Question 3

timing is

Answer 3

crucial in tax

Question 4

dollar today is..

Answer 4

more valuable than a dolar in the future because of abaility to invest.

Question 5

PV of future payments formula

Answer 5

i. PV=FV X PV factor (see table)

Question 6

taxes deferred

Answer 6

are taxes saved

Question 7

PV of future payments imprortant because..

Answer 7

allows people /particular the reach, to pay for deffered tax liability.