What is the formula used to calculate the appropriate discount rate for the calculation of the assumed gross investment income?
British Columbia, Canada
The following excerpt is from Larocque v. Lutz, 1981 CanLII 513 (BC CA):
In Fenn v. Peterborough, supra, the assumed gross investment income was 10 per cent per annum, the assumed inflation rate was 7 per cent per annum, the discount rate employed was therefore 3 per cent per annum, and the adjustment formula adopted in that case was 10 per cent per annum. It appears to have been awarded on a simple interest basis with no reinvestment or compounding contemplated.
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