Question Two: 1. The net present value is the difference between the present value of the cash inflows and the present value of the cash outflows. 2. The present worth of an investment that will grow to $1000 in 10 years at an interest rate of 5% per year, compounded annually is $605. 3. Time Value of money is the most important concept in Engineering Economics. 4. Individuals who come up with a new idea for a good or service, then they make it a reality are called entrepreneur. 5. If you are calculating the simple interest and you are given the time in months. You can find the time in years by dividing the months by 12.

Question Two: 1. The net present value is the difference between the present value of the cash inflows and the present value of the cash outflows. 2. The present worth of an investment that will grow to $1000 in 10 years at an interest rate of 5% per year, compounded annually is $605. 3. Time Value of money is the most important concept in Engineering Economics. 4. Individuals who come up with a new idea for a good or service, then they make it a reality are called entrepreneur. 5. If you are calculating the simple interest and you are given the time in months. You can find the time in years by dividing the months by 12.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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