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capitalization rate

(UK also capitalisation rate)
 
 
noun [C] (also cap rate)

Definition

ACCOUNTING, FINANCE the rate of interest used to calculate the present value of an investment or property that will provide an income in the future: Investors use the cap rate to estimate the purchase price for different types of income-producing properties.
(Definition of capitalization rate noun from the Cambridge Business English Dictionary © Cambridge University Press)

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