Cracking the Code of Finance

6. A reasonable rate of return established for the evaluation of an economic alternative.
9. Different sums of money at different times having equal economic value.
11. The concept that money can earn more money over time.
13. Determining a measure of worth for a project's net cash flow series over its life or study period.
15. The expected trade-in, market, or scrap value at the end of an asset's useful life.
16. Costs directly associated with labor, machines, and materials used in producing a product or service.
19. The point at which revenues equal costs.
20. The amount of time required to recover the initial capital investment.

1. COST The value of a forgone opportunity caused by the inability to pursue an alternative project.
2. Deviation from an expected, desirable, or predicted value that may negatively affect a project, process, or system.
3. The flow of money into and out of a company, project, or activity.
4. The cost of borrowing money or the reward for saving it.
5. The equivalent annual amount an asset or system must earn to recover the initial investment plus a stated rate of return.
7. Costs such as utilities, management, legal services, and taxes that are not directly attributable to a specific product or process.
8. The difference between cash inflows and cash outflows.
10. Cash inflows received by a company.
12. The interest rate incurred to obtain capital investment funds.
14. Additional worth created for a product or service that customers, owners, or investors are willing to pay for.
17. An increase in the amount of money required to purchase the same goods or services over time.
18. Money that has already been spent and cannot be recovered.