Discount rate (not the FRS discount rate) and opportunity cost of capital can be used interchangeably....
- Discount rate (not the FRS discount rate) and opportunity cost of capital can be used interchangeably.
- True
- False
Homework Answers
A. True
Discount rate, opportunity cost of capital, Hurdle rate and minimum acceptable rate of return all can be used interchangeably.
In capital budgeting, discount rate used to calculate the present value of future cash flows.
Discount rate or opportunity cost of capital is equals to earning opportunity lost due to not investing in available investment alternatives.
Hope this will help, please do comment if you need any further explanation. Your feedback would be highly appreciated.
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Discount rate (not the FRS discount rate) and opportunity cost
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