The rate used to discount project cash flows is known as the Blank______.

Question

Multiple select question.

discount rate

required return

cost of capital

market rate

Answer 1

The rate used to discount project cash flows is known as the:

• discount rate
• required return
• cost of capital

"Market rate" is less commonly used specifically in this context, although it can relate to the overall rate in the market for similar investments. The three options above are typically used to describe the rate applied to evaluate the present value of future cash flows for a project.