1.5 Key Terms
An accounting method used to allocate the cost of a tangible or physical asset over its useful life.
Economic gain or economic profit refers to the difference between the revenue received from the sale of an output and the costs of all inputs used, as well as any opportunity costs.
A rise in prices, which can be translated as the decline of puchasing power over time.
The amount a lender charges a borrower and is a percentage of the principal-the amount loaned.
The potential benefits that an individual, investor, or business misses out on when choosing one alternative over another.
The amount of money left over after spending and other obligations are deducted from earnings.
A financial principle that states the value of a dollar today is worth more than the value of a dollar in the future.
