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What is the difference between rate of return and return on investment?

The rate of return is a percentage that shows how much an investment has gained or lost over a specific period, while the return on investment is a ratio that compares the profit of an investment to its cost.


What is the difference between the hurdle rate and the discount rate, and how do they impact investment decisions?

The hurdle rate is the minimum rate of return required for an investment to be considered worthwhile, while the discount rate is used to calculate the present value of future cash flows. The hurdle rate influences whether an investment is accepted or rejected, while the discount rate affects the valuation of the investment. Both rates play a crucial role in determining the feasibility and profitability of investment decisions.


What is the difference between annual rate and annual yield?

The annual rate is the interest rate charged on a loan or investment, while the annual yield is the actual return earned on an investment, taking into account factors like compounding and reinvestment of earnings.


How do you find the rate of return on an investment?

To find the rate of return on an investment, you calculate the percentage increase or decrease in the value of the investment over a specific period of time. This is done by dividing the difference between the final value and the initial value of the investment by the initial value, and then multiplying by 100 to get the percentage return.


How can I calculate the rate of return on my investment?

To calculate the rate of return on your investment, subtract the initial investment amount from the final value of the investment, then divide that result by the initial investment amount. Multiply the result by 100 to get the rate of return as a percentage.

Related Questions

The relationship between the real interest rate and investment is shown by the?

Investment Demand Schedule


What is the tax rate on investment income?

You can click on the related link below for some information.


What is the difference between rate of return and return on investment?

The rate of return is a percentage that shows how much an investment has gained or lost over a specific period, while the return on investment is a ratio that compares the profit of an investment to its cost.


What is the Florida tax rate on investment income?

You can click on the related link below for some information.


Difference between marginal efficiency of investment and marginal efficicency of capital?

MEC is the expected rate of return on capital and MEI is the expected rate of return on investment.


What is the difference between the hurdle rate and the discount rate, and how do they impact investment decisions?

The hurdle rate is the minimum rate of return required for an investment to be considered worthwhile, while the discount rate is used to calculate the present value of future cash flows. The hurdle rate influences whether an investment is accepted or rejected, while the discount rate affects the valuation of the investment. Both rates play a crucial role in determining the feasibility and profitability of investment decisions.


What is the difference between the required rate of return and the expected rate of return in investment analysis?

The required rate of return is the minimum return an investor needs to justify the risk of an investment, while the expected rate of return is the return that an investor anticipates receiving based on their analysis of the investment's potential performance.


The basic trade-off in the investment process?

The basic trade- off in the investment process is between the anticipated rate of return for a given investment instrument and its degree of risk.


What is the difference between annual rate and annual yield?

The annual rate is the interest rate charged on a loan or investment, while the annual yield is the actual return earned on an investment, taking into account factors like compounding and reinvestment of earnings.


How can I calculate the rate of return on my investment?

To calculate the rate of return on your investment, subtract the initial investment amount from the final value of the investment, then divide that result by the initial investment amount. Multiply the result by 100 to get the rate of return as a percentage.


How do you calculate the rate of return on an investment?

To calculate the rate of return on an investment, you subtract the initial investment amount from the final value of the investment, then divide that result by the initial investment amount. Multiply the result by 100 to get the percentage rate of return.


How do you find the rate of return on an investment?

To find the rate of return on an investment, you calculate the percentage increase or decrease in the value of the investment over a specific period of time. This is done by dividing the difference between the final value and the initial value of the investment by the initial value, and then multiplying by 100 to get the percentage return.