Capital Budgettingedited (1) (1)
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Module 9: Capital Budgeting and Investment Analysis
The article under discussion is “Carlson, Rosemary. " Net Present Value (NPV) as a Capital
Budgeting Method.”
The Balance
, The Balance, 13 Sept. 2022,
https://www.thebalancemoney.com/net-present-value-npv-as-a-capital-budgeting-method-
392915
”
In the article, Rosemary Carlson discusses the concept of NPV and how it can be used as
a capital budgeting method. NPV is a method of discounting cash flows to find the present value
of an investment. The investment is then evaluated based on this present value. The NPV method
is used to find the best investment option by comparing the NPVs of different investment
options. The article explains the concept of Net Present Value (NPV) and how businesses can use
it for capital budgeting. NPV is a way of calculating money's future value, considering factors
such as inflation and interest rates. The article discusses the disadvantages and advantages of
using NPV as a capital budgeting method and provides examples of how NPV can be used in
decision-making.
This article was interesting and informative. It helped me understand the concept of NPV
and how it can be used as a capital budgeting method. This article is relevant to the course
because it discusses a critical financial concept to understand when making investment decisions.
Surname 2
I found the article to be clear and concise. It gave a good overview of NPV and how businesses
can use it. I found the examples to help understand how NPV can be applied in practice. This
article is also relevant to my personal experiences because I am interested in investing and
managing my finances. I can see how understanding and using NPV could be helpful in my
future career. This article has led me to wonder about the available investment options and how
to best choose an investment based on my goals. This article raised one question: how do we
select the appropriate discount rate when calculating NPV? The article explains that the discount
rate should reflect the risk of the investment, but it is not always clear how to determine the
appropriate level of risk.
Surname 3
Work Cited
Carlson, Rosemary. “Net Present Value (NPV) as a Capital Budgeting Method.”
The Balance
,
The Balance, 13 Sept. 2022,
https://www.thebalancemoney.com/net-present-value-npv-as-
a-capital-budgeting-method-392915
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Related Questions
Help please
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akeAssignmentMain.do?invoker%3D&takeAssignmentSessionLocator=&inprogress%3false
hapter 11 Lab Application
全 回
Sign ia
еBook
You have been depositing money into an account yearly based on the following investment amounts, rates and times, what is the value of that investment account at the end of that
period?
(Click here to see present value and future value tables)
Amounts of
Value at the End
Investment
Rate
Times
of the Period
$7,000
20%
16 years
612,094.91X
$11,000
15%
9 years
184,644.26X
$15,000
12%
5 years
95,292.71 X
$36,000
10%
2 years
75,600.00
Feedback
>
Check My Work
For each scenario, use the rate and time components to use the applicable time value of money table to determine the needed factor. Multiply the investment amount by the
future value factor to determine the value of end of the period.
6:38 PM
G O 4) ENG
13
68°F Sunny
10/26/2021
O
P Type here to search
hp
%24
%24
%24
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Module 6 Discussion
Discuss the significance of recognizing the time value of money in the long-term impact of the capital budgeting
decision.
60 Replies, 59 Unread
Σ
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Capital Budgeting and Risk Analysis
Post a Response
Describe the most important capital budgeting techniques and how they are used to arrive at investment decisions.
Name at least two capital budgeting techniques (for example, NPV, IRR, Payback Period, et cetera)
How does a manager differentiate when to use capital budgeting versus simple return on investment (ROI) techniques?
Respond to a Peer
Be sure to respond to at least one of your classmates' posts.
Read a post by one of your peers and provide a substantive response, making sure to extend the conversation by asking questions, offering rich ideas, or sharing personal connections.
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Q10) Capital budgeting involves ____________ decisions in purchasing ____________ assets.
Group of answer choices
a) investment; current
b) investment; fixed
c) financing; current
d) financing; fixed
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Subject: accounting
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Required:
A number of terms and concepts from this chapter and a list of descriptions, definitions, and explanations appear below. For each term
listed below (1 to 9), choose at least one corresponding item (a to k). Note that's single term may have more than one description, and
a single description may be used more than once or not at all.
A. Discounted cash flow method of capital budgeting.
B. Estimate of the average annual return on investment that a project will generate.
C. Capital budgeting method that identifies the discount rate that generates a zero net present value.
D. Decision that requires managers to evaluate potential capital investments to determine whether they meet a minimum criterion,
E, Only capital budgeting method based on net income instead of cash flow.
F. Ratio of the present value of future cash flows to the initial investment.
G. Value that a cash flow that happens today will be worth at some point in the future.
H. Concept recognizing that cash received…
arrow_forward
can u explain in excel how did they get this value, some areas
arrow_forward
Outlining the capital budgeting process
Review the following activities of the capital budgeting process:
a. Budget capital investments.
b. Project investments’ cash flows.
c. Perform post-audits.
d. Make investments.
e. Use feedback to reassess investments already made.
f. Identify potential capital investments.
g. Screen/analyze investments using one or more of the methods discussed.
Place the activities in sequential order as they occur in the capital budgeting process.
arrow_forward
help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working
arrow_forward
Pls show complete steps all the parts pls.
arrow_forward
You have been given the following return data, on three assets-A, B, and C-over the period 2021-2024. Using these assets, you have isolated three
investment alternatives:
a. Calculate the average portfolio return for each of the three alternatives.
b. Calculate the standard deviation of returns for each of the three alternatives.
c. On the basis of your findings in parts a and b, which of the three investment alternatives would you recommend? Why?
OCTOB
a. Calculate the portfolio return over the 4-year period for each of the 3 alternatives.
Alternative 1: 7.00% (Round to two decimal places.)
Alternative 2: 7.00% (Round to two decimal places)
Alternative 3: 7.00% (Round to two decimal places.)
b. Calculate the standard deviation of returns over the 4-year period for each of the 3 alternatives.
Alternative 1: % (Round to three decimal places)
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In proper capital budgeting analysis we evaluate incremental __________ cash flows.
Select one:
a.
accounting
b.
operating
c.
before-tax
d.
financing
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