Terminology_and_symbols - i = interest rate or rate of...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
TERMINOLOGY AND SYMBOLS The equations and procedures of engineering economy utilize the following terms and symbols. Sample units are indicated. P = value or amount of money at a time designated as the present or time 0. Also P is referred to as present worth (PW), present value (PV), net present value (NPV), discounted cash flow (DCF), and capitalized cost (CC); dollars F = value or amount of money at some future time. Also F is called future worth (FW) and future value (FV); dollars A = series of consecutive, equal, end-of-period amounts of money. Also A is called the annual worth (AW) and equivalent uniform annual worth (EUAW); dollars per year, dollars per month n = number of interest periods; years, months, days
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: i = interest rate or rate of return per time period; percent per year, percent per month t = time, stated in periods; years, months, days The symbols P and F represent one-time occurrences: A occurs with the same value once each interest period for a specified number of periods. It should be clear that a present value P represents a single sum of money at some time prior to a future value F or prior to the first occurrence of an equivalent series amount A . It is important to note that the symbol A always represents a uniform amount (i.e., the same amount each period) that extends through consecutive interest periods. Both conditions must exist before the series can be represented by A ....
View Full Document

This note was uploaded on 10/18/2009 for the course NFNSN GES2302 taught by Professor Inkla during the Spring '09 term at École Normale Supérieure.

Ask a homework question - tutors are online