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List and describe the four main investment appraisal methods. Which one is the best method to evaluate a risky investment and why?

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List and describe the four main investment appraisal methods. Which one is the best method to evaluate a risky investment and why?

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List and describe the four main investment appraisal methods. Which one is the best method to evaluate a risky investment and why?

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List and describe the four main investment appraisal methods. Which one is the best method to evaluate a risky investment and why?

Several different procedures are available to analyze potential business investments. The four procedures that provide useful information are the Net present Value (NPV), the Payback Rule, the Average Return on Assets (AAR), the Internal Rate of Return (IRR).

First, the most important concept of evaluating these investments is the NPV. NPV is defined as the difference between the initial cash outlay and present value of future cash inflows. It is only a good investment if ...

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