Benjamin Frank said: Qian Shengqian, the money generated will generate more money. This is the essence of the time value of money. The concept of time value of money holds that the money currently owned is more valuable than the money of the same amount received in the future, because the money currently owned can be invested and compounded. Even with the influence of inflation, as long as there are investment opportunities, the present value of money must be greater than its future value.

The definition given by experts: the time value of money refers to a certain amount of money currently held, which has higher value than the same amount of money obtained in the future. From an economic point of view, the reason why the purchasing power of the current unit currency is different from that of the future unit currency is that in order to save the current unit currency from consumption and convert it into consumption in the future, there must be more than one unit currency available for consumption in the future as a discount to make up for the delayed consumption.

Definition of time value of money: In terms of quantity, the time value of money is the average social profit rate without risk and inflation. When measuring the time value of money, risk reward and inflation factors should not be included.

The time value of money refers to the appreciation of money after a certain period of investment and reinvestment.