# Rate of Return on Capital

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A Rate of Return on Capital is a economic rate measure based on the ratio of after-tax income flowing to capital (rents, dividends and profits) to an invested capital book value/value of all capital.

**AKA:**ROC.**Context:**- It can range from being a Macroeconomic Return on Capital Rate to being a Microeconomic Return on Capital Rate.
- It can range from being a Real Rate of Return on Capital to being a Nominal Rate of Return on Capital.
- It can be based relative to Revenue, Costs, or Capital Employed.
- It can be a Average Annual Rate of Return, ...

**Example(s):****Counter-Example(s):****See:**NOPAT, Book Value, Invested Capital.

## References

### 2014

- (Wikipedia, 2014) ⇒ http://en.wikipedia.org/wiki/return_on_capital Retrieved:2014-4-26.
**Return on capital**(**ROC**) is a ratio used in finance, valuation, and accounting. The ratio is estimated by dividing the after-tax operating income (NOPAT) by the book value of invested capital.