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Are Economic Profit and the Internal Rate ofReturn Merely Accounting Measures?

The International Journal of Latest Trends in Finance and Economic Sciences

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Title Are Economic Profit and the Internal Rate ofReturn Merely Accounting Measures?
 
Creator Roush, Melvin L.; Pittsburg State University
Khaled, Mohammed S; Victoria University of Wellington
Keef, Stephen P.; Victoria University of Wellington
 
Description This paper explores the proposition that economic profit and the internal rate of return are merely accounting concepts.  They share a number of common aspects.  These include an allocation of capital that is unrelated to market forces and a treatment in the literature that focuses on the mathematics rather than the economics.  We show that the two measures have limited, if any, economic content.  Therefore we conclude that they are devoid of compelling theoretical interest in the domain of wealth maximization.       
 
Publisher International Journal of Latest Trends in Finance and Economic Sciences
 
Contributor —
 
Date 2011-11-29
 
Type —
 
Format application/pdf
 
Identifier http://ojs.excelingtech.co.uk/index.php/IJLTFES/article/view/243
10.2047/ijltfes.v1i3.243
 
Source International Journal of Latest Trends in Finance and Economic Sciences; Vol 1, No 3 (2011): September Issue
 
Language en
 
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