Assignment: Financial decision-making process.
Describe how net present value is used in the financial decision-making process.
Explain the disadvantages of using the payback method.
Compare and contrast the internal rate of return (IRR) method from the net present value method (NPV)
Explain the effects of sunk costs and opportunity costs in deciding whether to accept a project.
Review the financial considerations a company should make before investing in a project.
Understand how net working capital, depreciation and interest influence the decision to buy or not to buy.
Explain how inflation and interest rates affect the capital budgeting process.
Review the types of assumptions used in sensitivity and scenario analysis.
Describe how the options to expand or abandon a project are integrated in the capital budgeting process.
Explain how decision trees are used to value investment alternatives.
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Process of financial decision-making is the topic of this assignment.
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Explain how net present value is applied to financial decision-making.
Describe the drawbacks of employing the payback technique.
Compare and contrast the internal rate of return (IRR) and net present value (NPV) approaches (NPV)
Explain how sunk costs and opportunity costs affect the decision to accept a project.
Before investing in a project, review the financial considerations that a corporation should make.
Understand how net working capital, depreciation, and interest affect the purchase decision.
Explain how the capital budgeting process is affected by inflation and interest rates.
Examine the assumptions that are employed in sensitivity and scenario analysis.
Describe how the expansion and abandonment options work.
