NORMAL RATE OF RETURN Definition

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NORMAL RATE OF RETURN, for individuals, is the average rate of return on all investments, i.e. the average of all returns yields the normal rate of return. For capital investments for businesses, it is the profit relative to capital investment.

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ENTITY, in business, is a separate or self-contained existence that provides goods or services.

EQUITY INSTRUMENT covers any share (or part thereof) in the equity share capital of a company (or a comparable member's interest in a close corporation). The term also includes share options and any other financial instrument convertible into a share (such as a convertible debenture).

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