Explore BrainMass
Share

DEFINE AND EXPLAIN CAPITAL BUDGETING

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

DEFINE AND EXPLAIN CAPITAL BUDGETING WITH A BRIEF EXPLANATION OF
â?¢ Discounted payback period
â?¢ NPV
â?¢ IRR
â?¢ MIRR
â?¢ Profitability index
â?¢ Payback period

© BrainMass Inc. brainmass.com March 21, 2019, 9:35 pm ad1c9bdddf
https://brainmass.com/business/capital-budgeting/define-explain-capital-budgeting-382316

Solution Preview

Capital budgeting is a process in which a business determines whether a project such as building a new plant or purchasing a new machine is worth pursuing. A potential project's cash inflows and outflows which are generated over its lifetime are analysed in order to determine whether the returns generated meet a sufficient target benchmark. Ideally a business should pursue any and all projects that increase shareholder value. However, because the amount of capital available at any given time for new projects is limited, management uses capital budgeting techniques to determine which projects will yield the most return over an applicable period of time. ...

Solution Summary

The expert defines and explains capital budgeting.

$2.19