The Rate of Return That Owners of Capital Must Receive

question 213

Multiple Choice

The rate of return that owners of capital must receive in order to induce them to continue supplying the capital is often referred to as

• A) accounting profit.
• B) the normal or market rate of return.
• C) economic profit.
• D) the accounting rate of return.

---

Definitions:

Non-Interest-Bearing

Pertaining to debt or security that does not earn interest over time, usually issued at a discount to its redemption value.

Simple Interest

The calculation of interest that exclusively considers the initial amount of money deposited or borrowed, without compounding.

Promissory Note

A budgetary instrument which holds a written assurance from one party to compensate another with a predetermined sum of money, either instantly on demand or at a pre-agreed date.

Missing Value

A data point or entry that is not recorded or absent in a dataset.