Engineering economy 3 min read
LAW OF DEMAND
Law of demand establishes a relationship between the price and the quantity demanded of a commodity. Other things remaining the…
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Category: Engineering economy.
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Meaning of Demand
The demand for any commodity, at a given price, is the quantity of it which will be bought per unit,…
Engineering economy 2 min read
Future worth comparisons
When each of the cash flows of projects is expressed in terms of future time by the help of discounting…
Engineering economy 4 min read
Present worth comparisons
Comparisons of assets or investment projects are necessary in order to select the best among the alternatives, i.e., to accept…
Engineering economy 2 min read
Cash Flow Diagrams
Cash flow diagrams are graphical representation of cash flows (inflows and out flows) along a time line. Individual inflows or…
Engineering economy 2 min read
Defining Time Value of Money
It is a mechanics which involve the compound interest factors to express cash flows (payments) occurring at different times to…
Engineering economy 2 min read
Spreadsheets for economic analysis
In economic analysis spreadsheets may be helpful for a number of purposes: · Constructing tables of cash flows · Using annuity functions…
Engineering economy 2 min read
Nominal and Effective Interest
An interest rate takes two forms: nominal interest rate and effective interest rate. The nominal interest rate does not take…
Engineering economy 1 min read
Arithmetic Gradient Series
Suppose that there is a series of “n” payments uniformly spaced but differing from one period to the next by…
Engineering economy 2 min read
Uniform annual series and future value
Suppose that there is a series of “n” uniform payments, uniform in amount and uniformly spaced, such as a payment…
Engineering economy 2 min read
Interest and Equivalence
Simple interest, as opposed to compound interest, is rare. With an investment that pays simple interest, the amount of interest…
Engineering economy 2 min read
Making Economic Decisions
Selecting an appropriate criterion (or criteria) for selecting among competing alternatives is a critical step in engineering decision making. If…