Terminology_and_symbols

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

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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
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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 ....
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## 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.

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