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Glossary Term
Discount Rate for Valuation
Definition
The discount rate for valuation is the rate used to calculate the present value of future cash flows or earnings in financial models, such as discounted cash flow (DCF) analysis. In the MedTech industry, the discount rate reflects the perceived risk and the cost of capital associated with investments in medical device development, commercialization, and market operations.
Relevance to the MedTech Industry
The discount rate is critical for determining the current value of future revenue streams, particularly for long development cycles typical in the MedTech sector. It enables investors and stakeholders to assess the viability and profitability of projects or companies under varying risk conditions.
Additional Information & Related Terms
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