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CHAPTER 4

INVESTMENT CALCULATIONS

What Is Your Yield?

The calculation of yield or return can be confusing because there are so many variations on the theme. Return on equity, return on revenue, net return—all of these terms have precise meanings and applications, but they are often erroneously used interchangeably.

Return and yield are really the same thing, but the two terms are sometimes expressed differently. Return is synonymous with rate of return, which can be further distinguished as a return on a specific measurement (percentage of investment, equity, or revenue). Yield is the annual rate of return on real estate (or some other investment), ...

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