Examlex
Why do the arithmetic average return and the geometric return differ?
Interest Rate
is the percentage of a loan amount charged by the lender to the borrower for the use of assets.
Net Present Value
A calculation that compares the present value of a project's cash inflows to its cash outflows, used to assess the viability or profitability of an investment.
Interest Rate
The percentage of a loan that incurs interest costs for the borrower, often stated as an annual rate of the outstanding loan amount.
Net Present Value
A calculation that compares the value of all future cash flows of a project, discounted back to the present, to the initial investment.
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