A discount rate is the rate of interest used in ato convert future cash flows into a present cash value.
The discount rate has to take into account the risk of future cash flows, as well as the time value of money (i.e. cash now is worth more than the same amount of cash in the future).
- Discounted Cash Flow (DCF)
- Interest Rate (IR)
- Net Present Value
- Risk Free Rate
- Time Value
- Terminal Value (TV)
- Weighted Average Cost of Capital (WACC)