What is risk adjusted discount rate, Financial Management

Assignment Help:

Q. What is risk adjusted discount rate?

The risk adjusted discount rate includes two rates viz

(i) Risk-free rate: - Risk free rate is the usual rate or the usual discount rate that takes care of time element and

(ii) Risk Premium Rate: - Risk Premium Rate is the excess rate or extra rate that takes care of the risk factor.

Therefore the risk adjusted discount rate is the usual or normal discount rate for the time factor plus the extra or additional discount rate.


Related Discussions:- What is risk adjusted discount rate

Importance of wbs in the project communication process, Due to the complex...

Due to the complexity of the tasks involved in many projects, communication of responsibility for those tasks is often helped by means of graphical planning techniques.

What are the factors of debt securities, What are the factors of debt secur...

What are the factors of debt securities A legal agreement, known as a trust deed, is drawn between security holders and company issuing the debt securities. Every security issu

Operating cycle, make an cash conversion cycle of cabbages

make an cash conversion cycle of cabbages

Explain term financial intermediaries, Financial intermediaries Financi...

Financial intermediaries Financial intermediaries are significant to the efficient functioning of the financial markets as they act to bring the borrowers/companies and lenders

Contingency planning, Contingency Planning:   Once the events are eval...

Contingency Planning:   Once the events are evaluated and categorised, and the levels of risk attaching to them have established.  The organisation should then commence pla

Credit rating, As the number of companies borrowing directly from the...

As the number of companies borrowing directly from the capital market increases, and as the industrial environment becomes more and more competitive and demanding,

Define in- order-driven according to trade intermediation, Define the in- o...

Define the in- order-driven according to trade intermediation. In- order-driven markets: In order-driven markets, buyers and sellers trade unswervingly without any intermedi

Explain briefly the term e-billing, QUESTION (a) Describe briefly three...

QUESTION (a) Describe briefly three methods of electronic payment. (b) (i) Explain briefly the term E-Billing. (ii) Outline three advantages of E-Billing. (c) Why is c

Financial analysis project, 1. Collect three years of recent, financial...

1. Collect three years of recent, financial data (2007 - current), including the Balance Sheet, Income Statement, and Statement of Cash Flow. a. REQUIRED - paper copies o

INTEREST, Mr. X invests Rs. 10000 at 10% p.a compounded semi-annually. Comp...

Mr. X invests Rs. 10000 at 10% p.a compounded semi-annually. Compute value after three years.

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd