Difference between revisions of "Required rate of return"
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According to [[Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition)]], | According to [[Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition)]], | ||
:[[Required rate of return]], rs. The minimum rate of return on a common stock that a stockholder considers acceptable. | :[[Required rate of return]], rs. The minimum rate of return on a common stock that a stockholder considers acceptable. | ||
| + | According to [[Cost Accounting by Horngren, Datar, Rajan (14th edition)]], | ||
| + | :[[Required rate of return]] ([[RRR]]). The minimum acceptable annual rate of return on an investment. Also called the discount rate, hurdle rate, cost of capital, or opportunity cost of capital. | ||
==Related concepts== | ==Related concepts== | ||
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*[[Introduction to Financial Management]]. | *[[Introduction to Financial Management]]. | ||
| − | [[Category: Financial Management]][[Category: Articles]] | + | [[Category: Financial Management]][[Category: Articles]][[Category: Accounting]] |
Revision as of 13:12, 11 July 2020
Required rate of return, rs, is the minimum acceptable rate of return, considering both its risk and the returns available on other investments.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Required rate of return, rs. The minimum acceptable rate of return, considering both its risk and the returns available on other investments.
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Required rate of return, rs. The minimum rate of return on a common stock that a stockholder considers acceptable.
According to Cost Accounting by Horngren, Datar, Rajan (14th edition),
- Required rate of return (RRR). The minimum acceptable annual rate of return on an investment. Also called the discount rate, hurdle rate, cost of capital, or opportunity cost of capital.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
