A discount rate is a percentage rate that investors use to measure the value of future cash flows in today's dollars. A discount rate has a wide variety of applications in terms of analyzing ...

When you apply for a mortgage, your lender will probably quote you an interest rate -- say, 4.5%. The problem with the interest rate is that is doesn't usually reflect the true cost of borrowing money ...

The discount factor of a company is the rate of return that a capital expenditure project must meet to be accepted. It is used to calculate the net present value of future cash flows from a project ...

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...

Here's how to calculate the present value of a perpetual annuity that promises to pay flat or growing annual payments with helpful examples. A perpetual annuity, also called a perpetuity, promises to ...

Discounting a future cash flow expresses future returns in today's dollars. This allows a fair comparison between initial business expenses and your expected or realized returns. As an example, you ...

Accurate valuations are paramount in financial analysis, influencing corporate strategies, as well as investment decisions and market perceptions. Among various valuation methods, the discounted cash ...

The discount rate is used to calculate how much the expected future income from an investment over a given period of time is worth right now (the net present value), which can help you decide what you ...