compound annual return


compound annual return
= CAR
The total return available from an investment or deposit in which the interest is used to augment the investment. The more frequently the interest is credited, the higher the CAR.
CAR = 1 + (nominal rate-number of times interest paid per annum) The CAR is usually quoted on a gross basis. The return, taking into account the deduction of tax at the basic rate on the interest, is known as the compound net annual rate (CNAR).

Big dictionary of business and management. 2014.

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