The rate of returns in this app are calculated using concepts of net present value and internal rate of return. Net present value essentially captures the time value of money, i.e. that money today is more valuable than money later, as money today is immediately available. This Is captured by discounting the future cash flow (Revenue - Expenses) by a discount factor. This discount factor is linked to your preferences for the minimum return you need to get from an initial investment to justify it. The discount factor captures element of risk you associate with this investment, the interest rate you need for paying of the initial investment (if you take a loan for it) and the inflation rate. For example, if you take a loan at 5% interest rate, then your investment needs to at a minimum have a 5% return and be discounted by the same. The internal rate of return is simply the discount rate at which NPV is “zero” (if net present value is negative, it means the internal rate of return is below the entered discount rate”)