cut-off rate

cut-off rate

the minimum rate of return used in INVESTMENT APPRAISAL for the purpose of deciding if an investment project is to go ahead. A predetermined arbitrary cut-off rate may be used in place of the COST OF CAPITAL as the DISCOUNT RATE. Different cut-off rates may be employed for projects with different degrees of riskiness. See DISCOUNTED CASH FLOW.
References in periodicals archive ?
There has been at best a very modest improvement since then, as suggested by the decline in the after-tax Low Income Cut-Off rate from 2005 to 2011.
8bn of one-year funds into the banking system at a cut-off rate of 5.
It accepted some 24% of bids at the cut-off rate of 0.
This measure was taken to communicate that changes in the cut-off rate are not reflective of the monetary policy stance, while allowing SBP to focus on liquidity management consistent with the requirements of monetary policy implementation, he added.
0% Sb cut-off grade, and 17,300 ounces of gold at a cut-off rate of 0.
25 days after the cut-off rate, compulsory minimum definite dividends have a volatility of 0.
After a long period of waiting, the business circle has finally seen the cut-off rate on the Bank Indonesia Promissory Note (the SBI) decline to 29.
It should be noted that in Pakistan, in the large-scale manufacturing sector and especially so in the public sector, the cut-off rate is 20 percent.
The cut-off rate at the latest auction was 12 percent, with a weighted average rate of 12.
A press release by Bank Indonesia reveals that the 14 April 1999 auction on the SBI ended up with the weighted cut-off rate on one-month SBIs dipping by 0.
Also, during this period, it had been decided that a cut-off rate of 15 percent would be applicable to private-sector industrial projects because the private-sector investors complained that if the higher figure of 20 percent was used as a discount rate, then the Bruno Ratio, which measures the domestic cost of saving one unit of foreign exchange and also serves as a criterion of profitability, would decrease to such an extent that the project would become unprofitable.
7bn through sale of fixed rental rate three-year Ijara sukuk (Islamic bonds) at the cut-off rate of 5.