INTEREST is the amount of money paid for the use of borrowed capital or
the income produced by money, which has been loaned.
PRINCIPAL is the amount of money used on which interest is charge.
SIMPLE INTEREST - is the interest to be paid which is directly

UNIFORM GRADIENT SERIES OF CASH FLOWS
Arithmetic gradient series is a series of payments
in which each payment is greater than or less
than previous one by a constant amount G
0
1
2
3
4
n
G
2G
3G
(n-1)G
1.
Determine the equivalent present worth, future
wo

8. Suppose we know that p=1,000 D/5, where p
= price in dollars and D = annual demand. The
total cost per year can be approximated by
$1,000 + 2D2 .
Determine the value of D that maximizes profit.
Show that in part(a) profit has been maximized
rather t

Definition:
ENGINEERING ECONOMY is a discipline
concerned with the systematic evaluation of the costs
and benefits of the proposed business projects and
ventures. Its objective is to choose which among the
alternative course of action will give the maximu

DEPRECIATION
DEPRECIATION
Decrease in value of physical properties
with passage of time and use
Accounting concept establishing annual
deduction against before-tax income
- to reflect effect of time and use on assets
value in firms financial statements