Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

E. Project Management, Feasibility Study Preparation, Evaluation, Research, Development and Extension on Agricultural and Biosystems Engineering > EEcon_Money-Time Relationship > Flashcards

EEcon_Money-Time Relationship Flashcards

1
Q

It is the change in amount of money over a given time period

A

time value of money

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Amount of money after n periods

A

Future Worth / Future Value / F

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Initial amount of loan or money borrowed

A

Principal / Present Worth / Present Value / P

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

A fee that is charged for the use of someone else’s money

A

Interest (I)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Percentage of money charged as interest

A

Interest rate (i)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Number of interest period for which time is committed

A

Life of loan (n)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

True or False. If only the rate is stated, a 1-year interest period is assumed.

A

True

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

It is a series of equal payments made at fixed intervals for a specified number of periods.

A

Annuity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

It is a series of indefinite cash flows and can be considered as a special case of annuity.

A

Perpetuity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

The interest earned is directly proportional to the capital involved in the loaned.

A

Simple Interest

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

It includes charges for the accumulated interest as well as the amount of unpaid principal

A

Compound Interest

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

A fixed percentage of the principal multiplied by the life of loan

A

Simple Interest

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Sinong engineer na by December 12, 2024?

A

Syempre ako!

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Formula for ordinary simple interest

A

I = P(i)(d/360)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What formula are these:

I = P (i) (d/365)
I = P (i) (d/366)

A

Exact simple interest for ordinary and leap year

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Interest is compounded at the end of each finite length period, such as a year or a month

A

Discrete compounding

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Used to find F when given P
Notation: P (F/P, i%, n)

A

Single Payment Compound Amount Factor

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Notation used when finding P given F

A

F (P/F, i%, n)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Used to find P when given F

A

Single Payment Present Worth Factor

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Mode of compounding where money grows at every instant of time

A

Continuous Compounding

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Formula for finding F in a continuous compounding

A

F = Pe^(in)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

It is also called annuity where uniform amount of money, A, occurs at the end of each period for n periods with interest at i% per period

A

Equal Payment or Uniform Series

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

True or false. In annuity or equal payment series, P (present worth) occurs at the same time as the first A.

A

False. P occurs 1 interest period before the first A.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

True or false. In annuity, F (future worth) occurs at the same time as the last A, and n periods after P.

A

True

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

True or false. In annuity, A (annual worth) occurs at the end of periods 1 through n, inclusive.

A

True

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

Type of annuity where series of equal payments are made at the end of each period.

A

Ordinary Annuity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

Type of annuity where series of equal payments are made at the beginning of each period

A

Annuity due

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

Type of annuity where payments are delayed for a certain period before they begin

A

Deferred Annuity

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

In equal payment series, it is the factor used to find F when given A.

A

Sinking Fund Factor

30
Q

F = A (F/A, i , n)

A

Equal Payment Series - Compound Amount Factor

31
Q

In equal payment series, it is the factor used to find A when given P.

A

Capital Recovery Factor

32
Q

P = A (P/A, i, n)

A

Equal Payment Series - Present Worth Factor

33
Q

It is the ratio of the interest charge for 1 year to the principal

A

Effective interest rate

34
Q

True or false. The interest formula for discrete compounding uses an effective interest rate per period which must be consistent with n in terms of time units.

A

True

35
Q

True or false. When no compounding period is given, interest rate is an effective rate, with compounding period assumed to be equal to the stated time period.

A

True.

36
Q

True or false. When compounding period is given without stating whether the interest rate is nominal or effective, it is assumed to be effective. Compounding period is as stated.

A

False. It should be assumed as nominal.

37
Q

If interest rate is stated as an effective rate, then it is an ___________ rate

A

Effective

38
Q

Nominal or Effective?

Effective 3% per quarter

A

Effective

39
Q

Nominal or Effective?

1% per day compounded daily

A

Effective

40
Q

Nominal or Effective?

14% per year compounded daily

A

Nominal

41
Q

Nominal or Effective?

8% per day

A

Effective

42
Q

Nominal or Effective?

19% compounded semiannually

A

Nominal

43
Q

Nominal or Effective?

6% per quarter compounded quarterly

A

Effective

44
Q

Formula for nominal interest rate

A

r = iM

45
Q

What is M when the mode of compounding is semiannually?

A

M = 2

46
Q

In what mode of compounding should you use M=6?

A

Bi monthly

47
Q

What M will be used when the interest is compounded quarterly?

A

M = 4

48
Q

Nominal or effective?

11.5% compounded annually

A

Effective

49
Q

Formula for effective interest rate per compounding period, i

A

i = r/M

50
Q

It is an annuity where the payment periods extend forever or in which the period payments continue indefinitely.

A

Perpetuity

51
Q

What is the formula for P in Perpetuity?

A

P = A (1/i)

52
Q

The remaining balance of a loan is also known as?

A

Amount owed
Principal owed
Unrecovered balance
Unpaid balance

53
Q

A series of payments where the difference between consecutive payments (G) is constant

A

Uniform (Arithmetic) Gradient Series

54
Q

For uniformly increasing gradient series, G is?

A

Positive (+)

55
Q

Negative G is used for what type of uniform gradient series?

A

Decreasing

56
Q

What is the notation for finding the annuity given gradient?

A

G (A/G, i%, n)

57
Q

In this notation, what are we looking for? G (P/G, i%, n) ?

A

Principal / Present worth

58
Q

Series of payments where each payments is multiplied by a constant factor ƒ

A

Geometric Gradient Series

59
Q

ƒ is positive (+) for geometrically ____ gradient series

A

increasing

60
Q

For geometrically decreasing series, what sign must be used for ƒ

A

Negative (-)

61
Q

It is a financial instrument setting forth the conditions under which money is borrowed.

A

Bonds

62
Q

In equivalence calculations involving bonds, it is the value (price) of the bond N interest period prior to redemption

A

P

63
Q

In equivalence calculations involving bonds, Z is the ____

A

face or par value

64
Q

It is the value stated on the bond, usually in multiples of P1000

A

Per value or face value

65
Q

In equivalence calculations involving bonds, r is the ___

A

bond rate (nominal interest) per interest period

66
Q

It represents the interest per interest period, generally stated as a nominal rate per interest period, and is calculated based on the par or face value

A

Bond rate

67
Q

In equivalence calculations involving bonds, what is the symbol for the bond yield rate per period. It is the effective annual interest rate earned by a bond.

A

i

68
Q

In equivalence calculations involving bonds, it refers to the time that a bond or note is payable.

A

Maturity

69
Q

In equivalence calculations involving bonds, C is the ___

A

Redemption or disposal price

70
Q

In equivalence calculations involving bonds, n is the ___

A

number of periods before redemption

71
Q

It is the sum of first cost and present cost of perpetual replacement, operation, and maintenance. This expense is recorded at the cost of a fixed asset.

A

Capitalized Cost

E. Project Management, Feasibility Study Preparation, Evaluation, Research, Development and Extension on Agricultural and Biosystems Engineering (9 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions