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    Capital Budgeting

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    Why is Capital Budgeting an important technique for companies wishing to assess an investment in projects? Which technique would you recommend to management?

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    A capital expenditure is made by a company whenever it makes an expenditure that generates a cash flow benefit for more than one year. Examples of capital expenditure include the purchase of new equipment, expansion of production facilities, buying another company, acquiring new technologies, launching a research & development program, etc. These are important decisions for the company.

    Capital expenditures decisions are ...

    Solution Summary

    The solution discusses the importance of capital budgeting and recommends a technique.