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What discount rate is implicit in an investment

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DETERMINING THE DISCOUNT RATE

We frequently need to determine what discount rate is implicit in an investment.

There are only four parts to this equation: the present value (PV), the future value (FVt), the discount rate (r), and the life of the investment (t). Given any three of these, we can always find the fourth.

Can someone explain to me what the discount rate is? why its important? how i find it? this would be greatly appreciated.

Reference no: EM132097045

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