Glossary
With over 200 terms in both English and French, our M&A Dictionary is designed to help you better understand the key words and concepts related to the sale oe purchase of a business in Canada.
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Required Rate of Return
« Back to Glossary IndexCategory: Accounting and Finance
The required rate of return (RRR) in finance is the minimum return that investors demand for undertaking an investment, considering the associated risk. Also known as the discount rate or hurdle rate, RRR is a critical factor in investment decision-making. It represents the compensation investors expect for the time value of money and the risk they assume. A higher level of risk generally leads to a higher required rate of return. This concept is fundamental in discounted cash flow analysis and serves as a benchmark for evaluating the attractiveness of potential investments by comparing expected returns against the required rate.
« Back to Glossary IndexSynonyms:
Discount rate, Hurdle rate
Acronym:
RRR
French Translation: