520678
Investment appraisal
- Average rate of return
- This measures average annual profit as a
percentage of the sum invested
- Calculate life time profit( total inflows- outflows)
- Divide by number of years
- Divide by initial investment
- x100
- =%
- =%
- x100
- Divide by initial investment
- Divide by number of years
- This measures average annual profit as a
percentage of the sum invested
- Net present value
- Payback Period
- ARR and pay back period
are based purely on cash
flows
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