Capital Budgettingedited (1) (1)

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Metropolitan Community College, Omaha *

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MACROECONO

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Finance

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Jan 9, 2024

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docx

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3

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Surname 1 Student’s name Instructor’s name Course Due date 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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