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Find the critical point(s) of the function. Then use the second derivative test to classify the nature of each point, if possible. Finally, determine the relative extrema of the function.
Interest Rates
The cost of borrowing money, typically expressed as a percentage of the amount loaned, paid to the lender at regular intervals for the use of their money.
Bond Prices
The market value of a bond, which can fluctuate based on interest rates, the bond’s credit quality, and other factors.
Opportunity Cost
Cost associated with opportunities forgone when a firm’s resources are not put to their best alternative use.
Projected Net Present Value
An estimation of the present value of an investment's future net cash flows minus the initial investment cost.
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