Business Studies, asked by lokesh2001gp, 1 month ago

The minimum rate of return expected of a capital

investment project is termed as ————— ​

Answers

Answered by Anonymous
0

Answer:

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Answered by arshikhan8123
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Your answer is incomplete. Please check below the full content.

The minimum rate of return is usually called the:

a. nominal risk-free rate

b. nominal inflation rate

c. expected rate of return

d. expected required return

Answer:

The correct answer is (d) Expected Required Return.

Explanation:

Rate of Return:

In accounting and financial jargon, the rate of return for a certain financial asset can have many meanings depending on the situation. Depending on how inflation is taken into account, it can be expressed as either a nominal rate of return or a real rate of return. Even after accounting for the annualisation factor, it might be said.

Expected Required Return:

  • The return an investor anticipates receiving after making an investment is known as the expected rate of return.
  • Unless the investments are made in instruments with a predetermined rate of return, such interest on fixed deposits, the predicted rate of return is an assumption, and there is no guarantee that this rate of return will be realised.

Hence, we can conclude that the minimum rate of return expected out of a capital investment project is Expected Required Return.

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