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Techniques for selecting investment projects Name Institution Course instructor Date of submission Net Present Value Net Present Value (NPV) involves two concepts of value. First it is used to indicate the level of cash that will flow in as a result of an investment and then compares it to the cash that will flow out to form the investment. Because these cash flows take place over time and the investment tends to pay off much later it is important to consider the present and future in insensitive of the time value of money. References Bierman Jr H. & Smidt S. (2012). The capital budgeting decision: economic analysis of investment projects. Routledge. Brigham E. F. & Ehrhardt M. C. (2013). Financial management: Theory & practice. Cengage Learning. Daunfeldt S. O. & Hartwig F. (2014). What determines the use of capital budgeting methods? Evidence from Swedish listed companies. Journal of Finance and Economics 2(4) 101-112. Menassa C. C. (2011). Evaluating sustainable retrofits in existing buildings under uncertainty. Energy and Buildings 43(12) 3576-3583. [...]
Order Description:
These are two discussion questions for an online class. Minimum 270 words. 1. Describe and compare the four criteria commonly used for evaluating and selecting investment projects? Net present value (NPV) Profitability index (PI) Internal rate of return (IRR) Payback (PB) period 2. What major problems can you envisage in applying capital budgeting techniques to investments made by public sector and not-for-profit businesses? Minimum of 2 References, Please don’t use Investopedia.
Subject Area: Finance
Document Type: Research Paper
