Before & After
This tool is used to visually model the positive benefits and negative costs of engineering projects or potential investment opportunities over time.
What is a cash flow diagram?
This equals the Present Worth of Benefits minus the Present Worth of Costs.
What is Net Present Value (NPV)?
This depreciation method allows the same amount every year
What is Straight Line Depreciation?
Something that has a max or min at the best decision variable settings
What is an objective function?
The value of an investment at the initial time
What is the Principal (or Present Value)?
An index chemical engineers should use when estimating what something in the past would cost to purchase again
What is CEPCI?
This type of depreciation is best
What is modified accelerated cost recovery (MACRS)
A point at which the objective function is best for all decision variables
What is the global optimum?
Ring of Fire singer and a quantity calculated from profit plus depreciation
What is Johnny Cash Flow?
A cash flow that is predictable every month
What is an annuity?
In present worth analysis situations where there are multiple alternatives, for the "Do Nothing" alternative, the NPV usually equals this.
What is zero? NPV= 0
These are limits placed on decision variables
What are constraints?
What you can sell your capital asset for at the end of a project with a McDonalds's Big Mac, fries and a coke.
What is the Salvage Value Meal?
When cash flows increase or decrease each period by a constant amount
What is uniform gradient(G)?
The total worth of a project at the end of the project life
What is the cumulative cash position?
A decrease in purchasing power over time leading to a percent of profit on an investment.
What is the Inflation Rate of Return?
This is the interest rate at which the benefits are equivalent to the costs, or the present worth is 0.
What is the internal rate of return (IRR)?
or Discounted cash flow rate of return (DCFROR)
A historic depreciation method that is no longer in use by the federal government
What is double declining balance? (Or sum of years digits)
A model used to predict the probability of different outcomes
What is Monte Carlo Simulation?