- This topic has 2 replies, 2 voices, and was last updated 3 years ago by
.
Viewing 3 posts - 1 through 3 (of 3 total)
-
Posts
-
It says that RI will discourage investment as NBV of assets fall overtime and RI increases
could you explain thisTo get RI you deduct an amount equal to Interest rate x capital employed from profits.
The higher the capital employed, the larger the deduction and the smaller the RI.
If you change and old asset (low NBV) for a new one (high NBV), capital employed rises and RI decreases.
Viewing 3 posts - 1 through 3 (of 3 total)
- The topic ‘RI’ is closed to new replies.