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Capital, Intrest, and Profit Basic concept of interest and swell What is working capital? Capital is durable goods use in order to constitute resister goods and services. worth and rentings on investment Capital is bought and sell in capital market; some capital is rented push through by its confessers Ex: an flat that is owned by Ms, landlord power be rented out for a family to a student, and the periodic birthment of 800dollars per month would distinguish a rental. Capital vs. pecuniary assets clear assets: assets that rescue a physical form. Tangible assets include some(prenominal) fixed assets, such(prenominal) as machinery, buildings and land, and current assets, such as inventory. The opposite of a tangible asset is an impalpable asset. Nonphysical assets, such as patents, trademarks, copyrights, goodwill and brand recognition, are all fonts of intangible assets. The stray of diminish on investment Suppose that you own some capital and rent it out or that you have some immediate payment and lend it to a commit or to a elegant business. You will naturally sine qua non to know what you will pay to borrow or how oftentimes you earn by modify .This amount is called the appreciate of genteelness on investment. The order of have on investment is the outlay of borrowing or lending money (interest rates). Rate of return on capital Lets consider the example of a rental car company .

xxx company demoralises a used car for 20000dollars and rent it out, after subtracting all expenses and presumptuous no change in the cars price, the xxx company earns a net rental of 2400dollars each yea! r, so the rate of return is 12percent. 2400/20000=12percent The rate of return=dollars per period /dollars Example: I buy a plot of land for 100.000dollars and sell lit a year later for 110.000dollars of there are no other expenses the rate of return on this investment is 10.000dollar per year /100.000 or 10 percent . Financial assets and interest rates For the case of monetary assets, we use a different set of terms when measuring...If you indigence to get a full essay, order it on our website: BestEssayCheap.com

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