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If the standard to produce a given amount of product is 500 direct labor hours at $15 and the actual was 600 hours at $17, the rate variance was $1,200 favorable.
Desired Rate of Return
The minimum percentage return an investor expects to achieve by investing in a particular asset.
Present Value
The value today of a sum of money or cash flows expected in the future, discounted at a particular rate of return.
Compound Interest
Interest calculated not only on the original principal amount but also on the accrued interest from past periods on a deposit or loan.
Earnings Rate
Earnings rate refers to the percentage of return generated by an investment or the profitability of a company over a specified period.
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