Discount defined

Discounted cash-flow rate of return. Discounted cash-flow rate of return is defined as the discount rate i which makes the NPV of a project zero (curve 3 in Fig. A.2) ... 

The proflt-to-investmentratio (PIR) may be defined in many ways, and is most meaningful when deflated and discounted. On an undeflated and undiscounted basis, the PIR may be defined as the ratio of the cumulative cash surplus to the capital investment. This indicates the return on capital investment of the project, is simple to calculate, but does not reflect the timing of the income/investment in the project. 

So long as the field is on, these populations continue to change however, once the external field is turned off, these populations remain constant (discounting relaxation processes, which will be introduced below). Yet the amplitudes in the states i and i / do continue to change with time, due to the accumulation of time-dependent phase factors during the field-free evolution. We can obtain a convenient separation of the time-dependent and the time-mdependent quantities by defining a density matrix, p. For the case of the wavefiinction ), p is given as the outer product of v i) with itself. 

This gives two choices ia interpreting calculated NRR values, ie, a direct comparison of NRR values for different options or a comparison of the NRR value of each option with a previously defined NRR cutoff level for acceptabiUty. The NPV, DTC, and NRR can be iaterpreted as discounted measures of the return, iavestment, and return rate, analogous to the parameters of the earher example. These three parameters characterize a venture over its entire life. Additional parameters can be developed to characterize the cash flow pattern duting the early venture years. Eor example, the net payout time (NPT) is the number of operating years for the cumulative discounted cash flow to sum to zero. This characterizes the early cash flow pattern it can be viewed as a discounted measure of the expected operating time that the investment is at risk. 

Another possibiUty is the net payout fraction (NPE), defined as the ratio of the NPT to the operating life of the venture. This is the fraction of the expected operating lifetime needed to recover the discounted investment. 

Profitability Diag rams. Profitabihty diagrams of the type shown in Figure 3a for Venture A provide insight into venture profitabihty. Total return rate is defined as the sum of the discount rate and the net return rate (NRR). The discount rate, net return rate, and total return rate are all shown on the diagram as functions of the discount rate. Because the NPV is a nonlinear function of the discount rate, the NRR and total return rate are also nonlinear. The NRR, as a measure of the profitabihty, correctly decreases as the discount rate increases. 

Symbol indicating differentiation Debt ratio defined by Eq. (9-139) Discounted-casb-flow rate of return Empirical constant in general equations... 

These scales of extent define the manner in which the ideas of extreme events are applicable to agriculture and forestry. Wind-throw is a small-scale process and the forest manager must grow and manage plantation forests which will survive extreme wind speeds at the spatial scale of his plantation. The question is, how rare must this extreme event be, before it may be discounted. The answer is likely to be dominated by economics and also the longevity of the plants with a 50 year harvesting interval, it seems clear that the return periods of extreme events up to 50 years (at least) are crucial. 

The minor amounts of Mg++, Ca++, and Fe++ in the fluid might easily be accounted for by contamination by a small volume of a shallow groundwater or even by dissolution of concrete and steel in the wellbore. If we discount the results for minerals containing these components, we arrive at a well-defined equilibrium temperature slightly above 200 °C (Fig. 23.9). Again, the equilibrium temperature is slightly higher than the temperature measured in the wellbore. 

Cash flow is the amount of funds available to a company to meet current operating expenses. Cash flow may be expressed on a before- or after-tax basis. After-tax cashflow is defined as the net profit (income) after taxes plus depreciation. It is an integral part of the net present worth (NPW) and discounted cash flow profitability calculations. 

To understand this view, it is necessary to understand an interest as a mental representation of a utility. Interests have different properties, among them a "characteristic period of dominance a length of time when an interest s discount curve rises above those of its competitors. The period will depend on the kinds of rewards the interest has arisen to exploit and on the intrinsic limitations of their particular modes of exploitation. This period, in turn, will have major effects on what behaviors particular interests typically favor" (Ainslie 1992,96). In this perspective, he defines addictions as behavior caused by interests that dominate other interests in periods ranging from hours to days and states that addictions have a "clear phase of conscious though temporary preference, followed by an equally clear period of regret" (Ibid., 97). Other types of interest have other periods of dominance. The period of domination for pains is fractions of seconds, that for itches seconds to minutes, and that for sellouts months to years. 

Consequently, when faced with a consumption choice of the same type as Becker and Murphy s rational consumer, hyperbolic discounters with willpower will act in a similar way. In particular, the asymmetry between stopping and starting, which is the defining characteristic of Becker and Murphy s rational addict, is reproduced in the hyperbolic case. 

TCs are time consistent, so for each k, t) their continuation strategy maximizes their continuation utility. The implication of time consistency in the framework discussed in the preceding paragraph is that TCs correctly perceive their future behavior and that they discount the future benefit from current restraint by 6. Hence, we define perception-perfect strategies for TCs as ... 

At any point in time, naifs believe they will behave like TCs beginning with the next period. Hence, in any period, naifs perceive that they will follow strategy a beginning with the next period. Since naifs discount the future benefit of current restraint by , we define perception-perfect strategies for naifs as ... 

To define the economic performance of a manufacturing venture, an analyst must predict various sources and sinks of money throughout the lifetime of a project. In fact the investors invest a huge amount of money when they begin to build the chemical plant, but they will earn money from sales only when the plant is finished and operating. Owing to inflation and devaluation, future money is different from present money [13,15], Therefore, a future income needs to be discounted to its present value in order to evaluate the expected profitability of a chemical plant. Of course, when dealing with future events, nobody can be absolutely positive about prices, inflation rates, etc. Therefore many assumptions need to be... 

It is possible to define different indexes to understand whether a venture will be profitable [13]. Here we consider the discounted break-even period [14]. This index is defined as the time that must elapse after start-up until the discounted cumulative cash-flow repays the fixed capital investment. The discounted cumulative cash-flow is the sum of expenses and gains sustained or earned in the lifetime of a chemical plant. All these sums of money need to be discounted to their present value. 

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