The annual rate of return is variously referred to as the
A) discount rate.
B) opportunity cost.
C) cost of capital.
D) all of the above.

Question

Quizplus · Accepted Answer

The annual rate of return can be referred to as the discount rate, which is the rate at which future cash flows are discounted to their present value. It can also be referred to as the opportunity cost, which is the cost of foregoing the next best alternative investment opportunity. Additionally, it can be referred to as the cost of capital, which is the rate of return required by investors to provide funds for a project or investment. Therefore, all of the above options are correct.

The Annual Rate of Return Is Variously Referred to as the