Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 24Q: How does the size of the initial investment affect the internal rate of return on the net present...
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Question
What are the measures of investment worth based on yield? What are they called?
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Definition
Investment worth based on yield means that an investor is expecting certain income on an investment for holding securities. Unlike, return on investment, yield on investment is expressed as an annual percentage rate based on investment cost price.
Measures of investment worth based on yield
- Current yield
- Yield to maturity
- Yield to put
- Yield to worst
- Cash Flow yield
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