discount rate


Definition of discount rate

1 : the interest on an annual basis deducted in advance on a loan
2 : the charge levied by a central bank for advances and rediscounts

Examples of discount rate in a Sentence

Recent Examples on the Web Taiwan's central bank raised its benchmark discount rate by 12.5 basis points to 1.5% and lowered its economic growth outlook for the year. Medora Lee, USA TODAY, 16 June 2022 Saba's choice of discount rate was a major point of contention. Ryan Finley, Forbes, 26 May 2022 The Cowen analysts used a discount rate of 10% to compute the present value of their free cash flow forecasts for Amazon. Hersh Shefrin, Forbes, 31 Aug. 2021 In turn, that hurt tech stocks whose future cash flows are worth less in today’s terms when a higher discount rate is applied. Caitlin Mccabe, WSJ, 6 Jan. 2022 Depending on the discount rate of your future earnings, is that probabilistic money better kept as future earnings (yielding nothing), or invested in a solar array in Ghana? Matthew Harris, Forbes, 22 Oct. 2021 One approach involves adjusting the discount rate, or weighted average cost of capital. Lindsay Patrick, Fortune, 22 Feb. 2022 New York state uses a 2% discount rate to produce its current social cost of carbon of $125 per ton. Jim Krane, The Conversation, 12 Feb. 2022 But most of the time there is a tighter focus on the outlook for earnings and the discount rate. James Mackintosh, WSJ, 1 Feb. 2022 See More

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'discount rate.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

First Known Use of discount rate

1827, in the meaning defined at sense 1

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The first known use of discount rate was in 1827

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Last Updated

26 Jun 2022

Cite this Entry

“Discount rate.” Dictionary, Merriam-Webster, Accessed 2 Jul. 2022.

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More Definitions for discount rate

discount rate


Legal Definition of discount rate

1 : the interest on an annual basis deducted in advance on a loan
2 : the interest levied by the Federal Reserve for advances and rediscounts

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