term1 Definition1term2 Definition2term3 Definition3
Please sign in to your Google account to access your documents:
Accounting rate of return
A method of appraising capital investments where the average annual profits from a project are divided into the average investment cost, also known as return on investment and return on capital employed
Annual percentage rate (APR)
A discount or interest rate quoted as a rate per annum
Annuity
An asset that pays a fixed sum each period for a specified number of periods
Compounding interest
The concept of adding the interest earned to the original capital invested so that further interest is generated
Cost of capital
The financial return that an organization could receive if, instead of investing cash in a capital project, it invested the same amount in securities on the financial markets, also known as the opportunity cost of an investment, the minimum required rate of return, the discount rate and the interest rate
Cost benefit analysis (CBA)
An investment appraisal technique developed for use by non-profit making organizations that defines the costs and benefits of a project in much wider terms that those included in investment appraisals undertaken in the pursuit of profit maximization
Discount rate
The financial return that an organization could receive if, instead of investing cash in a capital project, it invested the same amount in securities on the financial markets, also known as the opportunity cost of an investment, the minimum required rate of return, the cost of capital and the interest rate
Discounted cash flow (DCF)
A technique used to compare returns on investments that takes account of the time value of money
Discounted payback method
A version of the payback method of appraising capital investments in which future cash flows are discounted to their present values
Discounted present value
The value today of cash to be received in the future, calculated by discounting
Need help typing ? See our FAQ (opens in new window)
Please sign in to create this set. We'll bring you back here when you are done.
Discard Changes Sign in
Please sign in to add to folders.
Sign in
Don't have an account? Sign Up »
You have created 2 folders. Please upgrade to Cram Premium to create hundreds of folders!