ENGINEERING ECONOMY EXAM 2 COMPLETE PREPARATION GUIDE WITH INTEREST FACTORS AND PROJECT EVALUATION METHODS REVIEW

ENGINEERING ECONOMY EXAM 2 COMPLETE
PREPARATION GUIDE WITH INTEREST FACTORS
AND PROJECT EVALUATION METHODS REVIEW

◉ Value.
Answer: Measure of worth a person ascribes to a good or services.


A utility to a person in terms of money.


◉ Cost.
Answer: Expenditure incurred in producing a product or service.


◉ Price.
Answer: Quantity of Resources (amount) a seller is ready to
exchange for goods or services.


◉ Market or Market Place.
Answer: A place where exchanges of goods and services take place


◉ Physical Market.
Answer: Fixed locations

, e.g. shop or group of shops


◉ Virtual Market.
Answer: online market


◉ Fair Market Value.
Answer: A price at which buyers and sellers with a reasonable
knowledge of pertinent facts and not acting under any compulsion
are willing to do business


◉ Distress Value.
Answer: Price Set by the buyer and seller on compulsion


◉ Capital.
Answer: Financial Resources deployed in an enterprise to produce
goods and services.


(e.g. Land, Building, equipment, money etc.)


◉ Equity.
Answer: Capital deployed in the form of ownership of an enterprise