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Discounting. In finance, discounting is a mechanism in which a debtor obtains the right to delay payments to a creditor, for a defined period of time, in exchange for a charge or fee. [1] Essentially, the party that owes money in the present purchases the right to delay the payment until some future date. [2]
Social discount rate ( SDR) is the discount rate used in computing the value of funds spent on social projects. Discount rates are used to put a present value on costs and benefits that will occur at a later date. Determining this rate is not always easy and can be the subject of discrepancies in the true net benefit to certain projects, plans ...
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