Interest rate criterion

For evaluating different projects, three discounted profitability criteria have been widely used time criterion, cash criterion, and interest rate criterion [7]. The time criterion is the discoimted payback period (DPBP), which is the time that is needed to recover the fixed capital investment (except land and WC) after the plant starts up. The cash criterion is known as net present value (NPV), which is the discounted cumulative cash position that can be calculated by summing all cash flows, positive and negative, as shown in Eq. [6.1] ... 

The interest rate criterion is known as discounted cash flow rate of return (DCFROR) or internal rate of return (IRR), which is defined as the discount rate calculated by setting NPV = 0 in Eq. [6.1] at the end of the period of the project. An IRR higher than the internal hurdle rate means that a project is worth investing from the perspective of a given company. 

Interest Rate Criterion. The criterion used here is called the rate of return on investment (ROROI)... 

Interest Rate Criterion. The discounted cash flow rate of return (DCFROR) is defined to be the interest rate at which all the cash flows must be discounted in order for the net present value of the project to be equal to zero. Thus, we can write... 

Banks are not in business to take risks. They rent money and do everything they can to insure the return of their principal as well as the interest. Elaborate rating systems have been developed to measure each company s ability to repay its loans. One criterion is the debt to equity ratio. The higher the debt the more risk in a loan, and the higher the interest rate. 

Based on the information provided inExanple 10.10 for an acceptable internal interest rate of 15% and time n = 5 yrs, determine the most attractive alternative, using the INPV criterion to conpare options. 

Model Predictive Control (MPC) has been also appUed to SC problems as a reactive approach. MPC is a control sfiategy based on the explicit use of a process model to predict the process performance over a period of time (Camacho and Bordons 1995). The model attempts to predict the control variables for a set of time periods. Predicted confiol variables depend on disturbance forecasts (i.e., demand, prices, and interest rates) and also on a set of given parameters that are known as control inputs. The MPC algorithm attempts to optimize a performance criterion that is a function of the control variables. Only a portion of the control variables, the portion corresponding to the following time period, is applied to the system. Next, as new control input information and disturbance forecasts are collected, the whole procedure is repeated, which produces a feed-forward effect and enables the system to counteract the environment dynamics. The procedure is illustrated in Fig. 1.6. 

Finally, there is an interesting article" that shows how to use Taylor s series to generate shortcut methods from established theory. Examples are given for developing a criterion for replacing log mean temperature differences with average differences and for estimating the effect of temperature on reaction rate. 

Many companies apply a minimum rate of return, or hurdle rate, to express the opportunity-cost competition between investments. For example, if a firm can draw 10 percent interest on cash in the bank, then 10 percent would be a valid choice for the hurdle rate as it represents the company s cash opportunity cost. Then, in analyzing investment options under a return-on-investment criterion, not only would the highest returns be selected, but any project that pays the firm a return of less than the 10 percent hurdle rate would not be considered. 

Peaking and Non-isothermal Polymerizations. Biesenberger a (3) have studied the theory of "thermal ignition" applied to chain addition polymerization and worked out computational and experimental cases for batch styrene polymerization with various catalysts. They define thermal ignition as the condition where the reaction temperature increases rapidly with time and the rate of increase in temperature also increases with time (concave upward curve). Their theory, computations, and experiments were for well stirred batch reactors with constant heat transfer coefficients. Their work is of interest for understanding the boundaries of stability for abnormal situations like catalyst mischarge or control malfunctions. In practice, however, the criterion for stability in low conversion... 

Consequently, a better criterion for evaluation is to use the net present value for each case. Select an interest (discount) rate of 15 percent per annum. 

Others have used the calculated value of L as a criterion 4). There has, however, been more interest in comparing the observed entropy of activation with what is physically possible for a postulated rate-determining step. 

Another interesting point is the relative rates of the reactions of the azido and thiocyanatopentaammines. The relative rates of these two reactants with iron (I I) ion are similar to those with chromium (I I), that is, the azide is four to five powers of ten more rapid than is the thiocyanato. I am suggesting that this might be a criterion for inner sphere activated complex as opposed to an outer sphere complex. With trisdipyridylchromium(II) ion, which must react via an outer sphere process, the azido and thiocyanato rates are relatively comparable, and the same also for vanadium (I I) ion which also probably procedes via an outer sphere activated complex. 

In both these cases there is an autocatalytic element, i.e. one which is both the product of the reaction and which tends to increase its rate. This is the substance B in the first case and heat in the second. It is this element of feedback that is the source of the interesting behaviour. The first two terms in both of these equations represent the access to the site of reaction, in this case the stirred tank, in accordance with the criterion of actuality. The feasibility of these simple reaction schemes can be established by showing that they can be embedded in a fully reversible mechanism and the simple system recovered by limiting processes that do not violate the laws of thermodynamics or kinetics (for example, the Wegscheider condition). Yablonskii and his coworkers (Bykov et al. 1978,1979a, b, c Yablonskii Bykov 1979 Gol dshtein et al. 1986) have considered a number of simple models from which it is clear that the autocatalytic feature is essential. In the bimolecular surface reaction the autocatalytic role is played by the vacant sites which are indeed the product of the main reaction which releases those previously held by adsorbate and, at the same time, are a positive influence on the rate of reaction. 

In connection with the expansion of the exponent in a series studied by Frank-Kamenetskii [3], a single criterion is sufficient to describe the dependence of the reaction rate on the temperature in the only temperature region of interest to us, that in which the reaction rate is high ... 

The distinction between electrophilic and electron-transfer mechanisms of addition reactions to vinyl double bonds of ArX—CH=CH2 (X = S, O, Se) has been achieved by studying substituent effects. Specifically, the effects of meta and para substituents on the rates of electrophilic additions correlated with Hammett radical cations correlates with statistical tests. The ofclcctrophilicj/o-1 (FT) dichotomy is in accord with the conventional paradigm for cr/cr+ correlations and further support has been found by ah initio calculations. Interestingly, the application of this criterion to the reactions of aryl vinyl sulfides and ethers with tetracyanoethylene indicates that cyclobutanes are formed via direct electrophilic addition to the electron-rich alkene rather than via an electron-transfer mechanism.12... 

In practice decision makers typically are risk averse and the expected value approach does not take into account the variability of the solutions obtained under the probability distributions or scenarios considered for the uncertain parameters. Rosenhead et al. (1972) introduced the aspect of robustness as a criterion for strategic planning to address this issue. Building on the notion of robustness, Mulvey et al. (1995) developed the concept of robust optimization distinguishing between two different types of robust models. A model is solution robust if the solution obtained remains close to optimality for any realization of the uncertain parameters. The model itself is robust if it remains (almost) feasible for any realization of the uncertain parameters (model robust).36 Here, only solution robustness is of interest as the most important elements of uncertainty in production network design, namely demand volumes, costs, prices and exchange rates, should not lead to infeasibility problems under different scenarios considered. 

With the system embedded in the physical environment all materials and energies of interest are evaluated according to their work potentials (exergies). The criterion for the system is a work measure. A typical function rated per unit time is... 

The dimer formation rate k was determined by fitting the TG signal at various concentrations using (8.7). The rate constant k decreased as the concentration decreased. From the slope of the plot of k vs. concentration and the relation k = Ay AppA, we determined the second-order rate constant Ay to be 2.5 x 105 M 1 s 1. Interestingly, this value is much smaller than that of a diffusion-controlled reaction ( T09 M 1 s 1) calculated by the Smolochowski-Einstein equation for a bimolecular reaction in solution [55]. This difference indicated that the collision between two protein molecules is not the sole criterion for the aggregation process i.e., their relative orientations dictate additional constraints, which slow down the rate of the reaction by 4 orders of magnitude. 

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