Reviewer for Engineering Economics, common across engineering boards.
1
Time Value of Money
Money now is worth more than the same amount later. Use interest formulas to compare cash flows.
Compound: F = P(1 + i)ⁿ
💡 Exam Hack
Always convert the interest rate and number of periods to the same time unit before computing.
2
Simple vs Compound Interest
| Type | Formula |
|---|---|
| Simple | I = P·i·n |
| Compound | F = P(1+i)ⁿ |
3
Depreciation
Assets lose value over time. The straight-line method spreads cost evenly:
Annual depreciation = (Cost − Salvage) ÷ Useful life
4
Worked Example
₱10,000 at 5% compounded annually for 3 years.
F = 10,000(1.05)³ = ₱11,576
📌 Quick Recap — Master These
Before your exam, make sure you can confidently explain and apply each of the following:
- Time Value of Money
- Simple vs Compound Interest
- Depreciation
- Worked Example
Re-read any section above where you hesitate.