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Citing three reasons, justify the time preference value for money.

Citing three reasons, justify the time preference value for money.

Answers

Justification of time preference for money
The time preference for money is the idea that a shilling is worth more today that it will be in future. This is because of;
(i) Availability of investment opportunities
(ii) Uncertainty – the future is uncertain, and therefore its better you have the money now
(iii) Decline in purchasing power of money. For example, what you can buy today for sh.1,000 may be worth sh.1,500 in the near future.

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francis1897 answered the question on November 1, 2022 at 11:06

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