Price regulated industries are commonly allowed to recover a benchmark return on invested capital. Over time, these regulated returns may be changed to remain in line with a benchmark opportunity cost of capital. This introduces a disconnect between the returns observed for a regulated entity and non-regulated companies of similar risk.
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Authors:
- Lau Nilausen
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Segment:
- Economic & Financial Consulting
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Asset type:
- Article
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Industry:
- Financial Institutions
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Topic:
- Innovation & Technology
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Country:
- UK
Date published:
- May, 2016