time value of money is based on the concept that a rupee that you have today is worth more than the promise or expectation that you will recieve a rupee in future. money that you hold today worth more because you can invest it and earn interest.for example, you can invest your rupee for one year at 6 percent annual interest rate and accumalate rs1.06 at the end of the year. a key concept of time value of money is that a single sum of money or a serious of equal,evenly spaced payments or receipts promised in the future can be converted to an equivalent value today.
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