Firm's opportunity cost when it uses its own assets for ongoing operations rather than for other uses. This rate can either be more or less than the company's overall cost of capital. If this rental rate is lower than the company's cost of capital, the company will not likely be able to stay in business for much longer.
Related information about implicit rental rate:
- Implicit Rental Rate Definition | Investopedia
The opportunity costs that a firm incurs as a result of using their own assets for ongoing operations instead of other alternative uses. The implicit rental rate can ...
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Definition of implicit rental rate: Firm's opportunity cost when it uses its own assets for ongoing operations rather than for other uses. This rate can either be more ...
- Implicit Rental Rate: Definition from Answers.com
Implicit Rental Rate The opportunity costs that a firm incurs as a result of using their own assets for ongoing operations instead of other alternative.
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This rental income foregone is the firm's opportunity cost of using its own capital, which is also referred to as the implicit rental rate of capital. This implicit rental ...
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The combination of depreciation and interest constitutes the 'implicit rental rate' of physical capital. All thing being equal, market forces should bring about the ...
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The implicit rental rate of capital is made up of. 1. Economic depreciation. 2. Interest forgone. Economic depreciation is the change in the market value of capital ...
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Nov 5, 2012 ... Potential homeowners compare that market rental rate as a tenant with an implicit rental rate that reflects the cost of owning a home. The tax ...
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Cost of capital — The implicit rental rate of capi- tal, the opportunity cost the business incurs by us- ing its capital rather than renting the capital to another firm , is ...