Analyses

The Analyze Menu

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Figure 10.1: Analyze Menu

The Analyze menu, shown in Figure 10.1, offers the following options for use on applicable investments:

Time Value analysis involves moving money through time across a defined MARR so that you can compare value at a consistent date. The MARR can be constant or variable over time.

Uniform Periodic Equivalent analysis determines the payment needed to convert a cashflow to uniform amounts over time, given a periodicity, a number of periods, and a MARR. This option helps when making comparisons where one alternative is uniform (such as renting) and another is not (such as buying).

The Internal Rate of Return of a cashflow is the interest rate that makes the time value equal to 0. This calculation assumes uniform periodicity of the cashflow. It is particularly applicable where the choice of MARR would be difficult.

The Benefit-Cost Ratio divides the time value of the benefits by the time value of the costs. For example, governments often use this analysis when deciding whether to commit to a public works project.

Breakeven Analysis computes time values at various MARRs to compare. It is advantageous when it is difficult to determine a MARR. This helps you determine how the cashflow's profitability varies with your choice of MARR. A graph displaying the relationships between time value and MARR is also available.

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