Reinvestment Rate Calculator

Calculate Reinvestment Rate



Formula

The formula to calculate the Reinvestment Rate is:

\[ RIR = \left( \frac{RA}{IA} \right) \times 100 \]

Where:

What is Reinvestment Rate?

The reinvestment rate is a measure of the percentage of earnings or returns that are reinvested back into the investment, rather than being withdrawn. It is a key metric for understanding the growth potential of an investment, as reinvested earnings can generate additional returns over time.

Example Calculation 1

Let's assume the following values:

Using the formula:

\[ RIR = \left( \frac{5000}{25000} \right) \times 100 = 20\% \]

The Reinvestment Rate is 20%.

Example Calculation 2

Let's assume the following values:

Using the formula:

\[ RIR = \left( \frac{10000}{50000} \right) \times 100 = 20\% \]

The Reinvestment Rate is 20%.