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Q: Would a dollar tomorrow be worth to you today when the interest rate is 20 or when it is 10?
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19 Why is a dollar worth more today than it will be worth tomorrow?

Because the dollar can be invested today and earn interest


Full form of NPV?

Net Present Value. This is the value of an investment in today's dollars. The theory behind this is that a dollar today is worth more than a dollar tomorrow because of the interest that can be earned.


What is the value of a dollar in 1989 compared to 2013?

A dollar in 1989 has the same buying power as 1.88 today. Or another way to look at it would be a dollar in 1989 would be worth approximately 53 cents today.


What would 2 from 1921 be worth today?

It would we worth about 10'123 dollar.


A dollar paid to you tomorrow is worth more than a dollar paid to you today if the interest rate is high rather than low?

the concept is the "the present value of future dollars vs the future value of present dollars" A dollar in hand has the potential to make money, how much money it can make is it's future value. The real intrigue with this is the concept of compound interest. today I invest my present DOLLAR, Lets say it makes 10 cents now I have $1.10 to invest and if I get the same rate of return I will make .11 cents and have $1.21 to invest. At a constant rate of 10% return I would double my money in about 8 years & 2 months. HOWEVER in year #12 I would have tripled my original DOLLAR and in year #15 my single Dollar would be worth over 4 dollars... So lets turn that around: if someone says to you LOAN me a (present) DOLLAR and I will pay you $2 (Future) in 10 years, that doesn't seem like as much of a good deal plus if you add in inflation and RISK, the $2 they pay you back with may not buy as much and that would make it an even worse deal.

Related questions

19 Why is a dollar worth more today than it will be worth tomorrow?

Because the dollar can be invested today and earn interest


Would a dollar tomorrow be worth more to you today when the interest rate is 20 percent or when it is 10 percent?

10 percent.


Full form of NPV?

Net Present Value. This is the value of an investment in today's dollars. The theory behind this is that a dollar today is worth more than a dollar tomorrow because of the interest that can be earned.


What is today if it was tomorrow but then tomorrow was today but then tomorrow was yesterday?

ok lets say today is monday. and if today is monday and today is tomorrow then tomorrow would be monday. then yesterday would be monday because tomorrow is yesterday.


3 A dollar today is worth more than a dollar to be received in the future because?

there are two reasons. 1. A dollar today can earn interest so you will have more than a dollar in the future. 2. Inflation will reduce the purchasing power a dollar over time, so it's better to get the dollar today and spend it today because it won't buy as much stuff tomorrow.


If today is Friday what is tomorrow?

Tomorrow would be Saturday if it is Friday today.


If today's tomorrow was tomorrows yesterday what would today be?

Today would today!


Does inflation have anything to do with making a dollar today worth more than a dollar tomorrow?

Of course it does. Inflation is the devaluing of money over time. It is always displayed as a percentage. For instance, inflation (usually measured as the Consumer Price Index) one year might be 3%. That means that a dollar in the current year would be worth $1.03 the year before. The saying is kind of misleading though. Inflation usually happens so slowly that a single dollar will not be actually worth less after a single day. Take the rate of inflation for the US since 1968, 519%. Divide that by the number of years since 1968 (40), it comes to 12.975%. Divide that by 365... it comes to .03%. So a dollar tomorrow is only worth .03% more than a dollar today if you apply the 40-year historical average (it is actually different because inflation right now is not 12.975%). While inflation makes one dollar today worth more than a dollar tomorrow, it (inflation) is not the only reason for that. Even if inflation is 0%, a dollar today is still worth more than a dollar tomorrow, for a couple of reasons like 1. if you can buy something today, you can enjoy it (one day) more than if you had bought it the next day 2. by investing a dollar today, you can earn interest, increasing the value of the dollar (in the US, the Fed does manage money supply and interest rates, so there will be some correlation between changes in inflation and changes in interest rates) 3. Perhaps, we will not be able to enjoy the worth of the dollar tomorrow.


What is tomorrow and after today?

anything taking place tomorrow Tomorrow is the name given to the day after today and 'after tomorrow' is any time further into the future than today, which would include tomorrow but also all the days after it.


If today was tomorrow and yesterday was today. What is tomorrow?

tommorrow never comes but still, it would be the day after tommorrow:)


If yesterday is tomorrow and tomorrow is today then what is yesterday if today would be tomorrow?

If today is tomorrow, then yesterday's tomorrow is today.Another answer: Yesterday's tomorrow is today. This is a fact. This is reality.But if what we think is today is really tommorow, then we are a day behind! So rather than yesterday's tomorrow being today, 'yesterday's tomorrow' must be one more day than today, i.e. it must be tomorrow!


Probabllity it will rain tomorrow 0.25 then the probiblity it will not rain tomorrow is?

why it would be rain tomorrow i thing but today they were rain and then tomorrow it would be the same thing..