Discount factor tables - Page 45
The whole life costing (WLC) technique is concerned with the assessment of the time stream of costs and revenues that will flow throughout the life of a construction project option.
As 'money today' has a different value to 'money tomorrow' or 'money in 10 years' time', a technique has to be adopted that will express future costs or revenues in present values for comparative purposes. The process of converting 'future money' to 'present money' is called 'discounting'.
Discounting involves establishing the discount rate to be used. In making a decision on a discount rate for a particular project, some judgment will need to be exercised about the degree of risk return (interest) and the likely levels of future inflation rates.
These tables provide assistance in calculating the discount rate and are taken from pages 45-47 in Part 2, section 2 of the old Surveyor's Construction Handbook.
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