RATES OF RETURN

Rates of Return

Rate of Return

Rate of Return or Return (ERR) of an asset is defined as the ratio of interest received and capital invested. The rate is usually expressed in percentage and, of course, is essential to specify the time period that is referred. This is the simplest concept of profitability. To calculate the cost of more complex situations, when they are involved not one but several financial capital, it is necessary to use different concepts.

Net Present Value Method (NPV)

The Net Present Value method is widely used for two reasons, first because it is very easy to apply and ...