Asked by Heena Munshi on Jun 14, 2024
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The annual rate of return is computed by dividing expected annual net income by average investment.
Annual Rate of Return
The percentage return on an investment over a one-year period, encompassing both capital gains and interest payments.
Expected Annual Net Income
The projection of a company's net income over a year, taking into account estimated revenues and expenses.
Average Investment
The middle amount invested over a period of time, often used in performance measurement or investment appraisal.
- Understand the approach to compute the annual return rate on investment projects.
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Learning Objectives
- Understand the approach to compute the annual return rate on investment projects.
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