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Average Rate of Return
The Average Rate of Return (ARR) measures the profitability of an investment as a percentage of the initial or average investment cost. It helps businesses compare the potential returns of different investment projects.
Investment Appraisal
Investment appraisal is the process of evaluating the potential profitability and risks of an investment to determine its financial viability.
Payback Period
The payback period is the amount of time it takes for an investment to generate enough cash flows to recover the initial investment cost.