ENGLISH


performance of a group of similar units.


041 COMPOUND INTEREST RATE


 F: TAUX D'INTERET COMPOSE
S: TASA DE INTEREST COMPUESTO


The rate of interest used in COMPOUNDING or
Depending on the content, it may be a market
OPPORTUNITY COST rate. See COST OF CAPITAL.


042 COMPOUNDING


DISCOUNTING.
rate or an


F: CAPITALISATION,
 COMPOSITION
 S: CAPITALIZACION


Calculation of the future value of a present sum by application of
the relevant rate of interest. It is given by:

 n
 C = C (1 + i)
 n o

where i is the interest rate per period (usually per year), n is
the number of periods, Co is the present sum and Cn is the value
after n periods. Note that this formulation assumes i is the same
in each period. See also COMPOUNDING FACTOR.


043 COMPOUNDING FACTOR


 F: FACTEUR DE COMPOSITION
S: FACTOR DE CAPITALIZACION


The coefficient
 n
 (1+i)

used in COMPOUNDING where i is the relevant rate of interest and
the number of periods is n.


044 CONSEQUENCE


F: CONSEQUENCE
S: CONSECUENCIA


The outcome or payoff a decision maker receives or suffers when he
adopts a particular ACT and when a particular STATE OF NATURE
ensues.


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