Abstract
Time value of money (TVM) is a crucial concept in corporate valuation. Think about the popular English proverb that “time is money.” That is, wasting time means losing money. In the real world, every aspect of human activity takes time—that is, time is valuable because, in the end, it is translated into returns. Now, suppose that you have won a lottery worth $10,000 and you are asked: “We would like to pay your money; do you prefer to receive it now or next week?” In addition, suppose that you borrowed $5000 from a friend and you were on the way to pay him. However, you friend gives you a choice: “You will pay me next month, but you can pay now if you like.” How would you respond to these questions? This chapter presents the concept of time value in relation to corporate valuation.
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Kulwizira Lukanima, B. (2023). Time Value of Money. In: Corporate Valuation. Classroom Companion: Business. Springer, Cham. https://doi.org/10.1007/978-3-031-28267-6_3
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DOI: https://doi.org/10.1007/978-3-031-28267-6_3
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