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Monday, October 5, 2009

Return On New Invested Capital - RONIC

Return On New Invested Capital - RONIC
A calculation used, either by a firm or investors, to determine the amount of return that a firm could earn on additional contributed capital. The calculation measures the return generated when a company converts its capital into capital expenditures, which generate revenues from core operations. A higher RONIC equates to a relatively efficient firm.

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