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| permanently invested money |
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| not enough cash to pay bills |
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| cents out of a dollar kept |
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| how enterprises are managed |
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| assests held to conserve capital |
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| Financial Managers Dilemma |
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| profitability over liquidity |
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| never borrow short and lend long |
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| return on best available alternative use |
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| convert an amount into a future or present amount |
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| interest=principleXrateXtime |
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| payment of a fixed amount of money for years |
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| interest rates plotted against time to maturity |
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| links interest rate to risk |
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| make money while using the loan, repay principle, pay a fee to lender, and have profit left over |
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| tendency to want money now rather than later |
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| ratio of dollars repaid to dollars borrowed |
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| ratio of buying power borrowed and repaid |
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| failure to recognize nominal and deflated rates |
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| likelihood actual return will differ from expected value |
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