Answer
Time value of money is the most important term in finance. The idea that money available at the present time is worth more than the same amount in the future due to its potential earnings capacity. The core principle of future holds that provided money can earn interest any amount of money is worth more the sooner it is received.
Everyone learns that money deposited in a savings account will earn interest. Because of this universal fact, we would prefer to receive money today rather than the same amount in future. The value of money is always changeable.
Suppose 5% interest rate P.A. 1000 invested in a bank today after one year this 1000 will be 1050{1000 + (1000 x 5%)}