Business Mathematics - Lecture Notes

These flashcards cover key terms and concepts related to business mathematics.

Arithmetic Progression

A sequence of numbers in which the difference between consecutive terms is constant.

Sum of the first n terms (Sn)

Given by the formula Sn = rac{n}{2} [2a + (n - 1)d], where a is the first term and d is the common difference.

Geometric Sequence

A sequence where each term is found by multiplying the previous term by a constant.

Compound Interest

Interest calculated on the initial principal and also on the accumulated interest from previous periods.

Simple Interest

Interest calculated only on the principal amount, not on the interest accrued.

Depreciation

A decrease in the value of an asset over time, in this case, calculated as a percentage of the asset's value.

Future Value

The value of an investment after interest is added over a period of time.

Net Present Value (NPV)

The difference between the present value of cash inflows and the present value of cash outflows over a period of time.

Internal Rate of Return (IRR)

The discount rate that makes the net present value of all cash flows from a particular project equal to zero.

Amortization

The process of paying off a debt over time through regular payments.

APR

Annual Percentage Rate, the annual rate of interest charged on a loan or earned through an investment.

Investment

The action or process of investing money for profit or material result.

Cash Flow

The total amount of money being transferred into and out of a business.

Discount Rate

The interest rate used to determine the present value of future cash flows.

Savings Account

A bank account that earns interest on the deposited funds.