Discount rate/Definition

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Revision as of 05:50, 28 February 2008 by imported>Nick Gardner (New page: The percentage by which the current value of an asset (to a person or to a commercial organisation) exceeds its value in a year's time. For a person, it is equal to that person’s...)

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The percentage by which the current value of an asset (to a person or to a commercial organisation) exceeds its value in a year's time. For a person, it is equal to that person’s marginal rate of substitution between consumption in the two successive years. For a commercial organisation, it is equal to that organisation’s cost of capital (qv).

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