The case determines various analytical techniques with the multi-year period over which a new asset will be utilized, and describes these three main techniques including, internal rate of return, payback period, and net present value.
It also describes the outcomes of selected discount rate, the issue of risk, and what are the general ways that the companies often use to deal with risk while evaluating the investment proposals. It also determines the impact of some non-quantitative considerations on senior management’s decision regarding an investment proposal. At the end, it associates the capital investment with various other firm’s course of actions that are being followed.
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