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Finance Dictionary and Glossary of Investment Terms
Capitalization rate
Definition 1.
he rate of interest used to calculate the present value of a number of future payments.
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Definition 2.
According to the Appraisal Institute, it is a method used to convert an estimate of a single year's income expectancy into an indication of value in one direct step, by dividing the income estimate by an appropriate rate.
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Definition 3.
The discount rate used to determine the present value of a stream of future earnings. Equals normalized earnings after taxes divided by present value, expressed as a percentage.
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