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Va Interest Rate and Discount Disclosure  Form

Va Interest Rate and Discount Disclosure Form

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Instructions and help about va form interest rate and discount disclosure

hi i'm rainey with finance strategist in this lesson we're going to cover [Music] discount rate is the rate of return used to discount future cash flows when calculating an investment's present value a discount rate is applied to future cash flows because money earned in the future is less valuable than money earned today this is based on the principle that money should make more money over time a concept known as the time value of money the discount rate is often used when computing a company's weighted average cost of capital or wacc and is used as a required rate of return or the hurdle rate that companies and investors expect as a return on their investment companies will have different discount rates since they will have different expectations for what return their investments should make for the company in general newer companies that are growing will have a higher internal rate of return and therefore use a higher discount rate when discounting future cash flows a company's dis

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