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e. CAGR (compound ordinary progress return). A capital investor is really interested in the net return acquired 12 months just after 12 months, As a result utilization of geometric is a lot more correct. Hence we might use geometric regular for possibility cost-free price and hazard premium for each from the three divisions, as presented in exhibit five of your case.
The administration charge is decrease than the operation and depreciation charges. Because of this, the overall cost of ownership is larger compared to the money. For that reason, the overall cost of administration is usually decrease when compared to the funds prices.
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