Another name for discount rate finance
Most people know that money you have in hand now is more valuable than money you collect later on. Future money is also less valuable because inflation erodes its buying power. This is called the time value of money. But how exactly do you compare the value of money now with the value of money in the future? That is where net present value comes in. When a manager needs to compare projects and decide which ones to pursue, there are generally three options available: internal rate of return, payback method, and net present value.
What Is the Discount Rate?
This reverse dictionary allows you to search for words by their definition. Check out RelatedWords. Click words for definitions.
As you've probably noticed, words for " term " are listed above. Hopefully the generated list of words for " term " above suit your needs. If not, you might want to check out Related Words - another project of mine which uses a different technique not though that it works best with single words, not phrases. The way Reverse Dictionary works is pretty simple. It simply looks through tonnes of dictionary definitions and grabs the ones that most closely match your search query. For example, if you type something like "longing for a time in the past", then the engine will return "nostalgia".
The engine has indexed several million definitions so far, and at this stage it's starting to give consistently good results though it may return weird results sometimes. It acts a lot like a thesaurus except that it allows you to search with a definition, rather than a single word. So in a sense, this tool is a "search engine for words", or a sentence to word converter.
I made this tool after working on Related Words which is a very similar tool, except it uses a bunch of algorithms and multiple databases to find similar words to a search query.
That project is closer to a thesaurus in the sense that it returns synonyms for a word or short phrase query, but it also returns many broadly related words that aren't included in thesauri. So this project, Reverse Dictionary, is meant to go hand-in-hand with Related Words to act as a word-finding and brainstorming toolset.
For those interested, I also developed Describing Words which helps you find adjectives and interesting descriptors for things e. In case you didn't notice, you can click on words in the search results and you'll be presented with the definition of that word if available. The definitions are sourced from the famous and open-source WordNet database, so a huge thanks to the many contributors for creating such an awesome free resource.
Special thanks to the contributors of the open-source code that was used in this project: Elastic Search , HubSpot , WordNet , and mongodb. Reverse Dictionary. Popular Searches. Here's a list of the sites that I'm currently working on: reverse dictionary is a website that allows you to find words based on their definition.
In other words, it turns sentences or phrases into words. Give the engine a seed word and it will find a huge list of related words. It allows you to do a broader search than a thesaurus allows. It helps you find inspiration for describing things. It inclides lists of new songs from all major genres from hip-hop to classical and everything in between. It is also searchable, so you can quickly find what you're looking for. If you're looking for synonyms of a slang word, this website will help you out.
a rate used for discounting bills of exchange. wiacek.com.au › Economy › Government & Policy.
This website uses cookies to ensure you get the best experience. Learn more Got it! The problems surrounding the determination of a fair discount rate are considered in preceding paragraphs in this paper. Unlike the Discount Rate you will not have to pay out a percentage of the American Express sales. Novice skiers, for example, can purchase a lift, lesson and equipment package at a discount rate.
From Wikipedia, the free encyclopedia. Discount rate may refer to: An interest rate the term "discount" does not refer to the common meaning of the word, but to the meaning in computations of present value The central bank's discount window interest rate The annual effective discount rate , an alternative measure of interest rates to the standard Annual Percentage Rate The asset appropriate rate used in calculating the discounted cash flow value of a traded investment or corporate finance "project".
Discount rate is a crucial concept in finance and could mean two things. First, is in reference to the interest rate that the central banks charge commercial banks and other financial institutions.
Discount Rate – Meaning, Importance And More
Depending upon the context, the discount rate has two different definitions and usages. While commercial banks are free to borrow and loan capital among each other without the need of any collateral using the market-driven interbank rate , they can also borrow the money for their short term operating requirements from the Federal Reserve Bank. This special Fed-offered lending facility is known as the discount window. Such loans are granted by the regulatory agency for an ultra-short term period of hours or less, and the applicable rate of interest charged on these loans is a standard discount rate. The Fed's discount window program runs three different tiers of loans, and each of them uses a separate but related rate. This primary credit discount rate is usually set above the existing market interest rates which may be available from other banks or from other sources of similar short term debt.
A Refresher on Net Present Value
This reverse dictionary allows you to search for words by their definition. Check out RelatedWords. Click words for definitions. As you've probably noticed, words for " term " are listed above. Hopefully the generated list of words for " term " above suit your needs. If not, you might want to check out Related Words - another project of mine which uses a different technique not though that it works best with single words, not phrases. The way Reverse Dictionary works is pretty simple. It simply looks through tonnes of dictionary definitions and grabs the ones that most closely match your search query. For example, if you type something like "longing for a time in the past", then the engine will return "nostalgia". The engine has indexed several million definitions so far, and at this stage it's starting to give consistently good results though it may return weird results sometimes.
In finance, the discount rate has two important definitions.
We just launched engagement data! One of the first things you need to do to make your company attractive to investors is find your discount rate. Measuring your discount rate as a business, however, can be a complex proposition. For both companies and investors, discount rate is a key metric when positioning for the future.
Discount Rate
Tony taught Business and Aeronautics courses for eight years; he holds a Master's degree in Management and is completing a PhD in Organizational Psychology. Log in or sign up to add this lesson to a Custom Course. Log in or Sign up. We all know that banks loan money to individuals but have you ever wondered what happens when a bank needs a loan? There are two main uses of the term discount rate that we will explore in this lesson. The first is when banks need to borrow money from the Federal Reserve and the other is when businesses want to figure out the value of future income. Banks make a profit by collecting the interest on money loaned to individual and business customers. We know that banks can use a percentage of the deposits they hold from customer accounts but many times that may not be enough to supply all of the automobile, home, and business loans that they wish to make. When banks need to borrow money, they go to the Federal Reserve Bank and are charged a percentage of interest known as the discount rate. There is also another definition of discount rate that is used in a process called discounted cash flow DCF.
What is Discount Rate? - Definition, History & Formula
The cost of capital and the discount rate are two very similar terms and can often be confused with one another. They have important distinctions that make them both necessary in deciding on whether a new investment or project will be profitable. The cost of capital refers to the required return necessary to make a project or investment worthwhile. This is specifically attributed to the type of funding used to pay for the investment or project. If it is financed internally, it refers to the cost of equity. If it is financed externally, it is used to refer to the cost of debt. The discount rate is the interest rate used to determine the present value of future cash flows in a discounted cash flow DCF analysis. This helps determine if the future cash flows from a project or investment will be worth more than the capital outlay needed to fund the project or investment in the present. The cost of capital is the minimum rate needed to justify the cost of a new venture, where the discount rate is the number that needs to meet or exceed the cost of capital. The cost of capital is the company's required return.
