Investment Appraisals And Capital Budgeting

1079 Words5 Pages
Capstone Project
Logan Belt
Investment Appraisals/Capital Budgeting Investment appraisals are an integral part of the business industry. Every sector of business and government utilizes it to some extent. Investment appraisals are defined by The Business Dictionary as “An evaluation of the attractiveness of an investment proposal, using methods such as average rate of return, internal rate of return (IRR), net present value (NPV), or payback period”. This can be used for a wide range of areas. Even where the returns are less visible such as personnel, marketing, and training. Investment appraisals are used by nearly everyone who utilizes capital. Private businesses are the most common; however it is an important tool to governments as well. There are many steps involved with Investment Appraisals because of the nature of it. One wrong investment could bankrupt a company or government. One such government that used Investment Appraisals and grew as a result is Suwanee, Georgia. What is an Investment Appraisal? Britannica describes investment as difficult because it reflects forecasting problems that depend on thousands of individual decisions that are not recorded publicy. Private Investment is the most subject to recessions and economic booms. An accurate appraisal is therefore needed to ensure the profitability and return of investments. Investment Appraisal is a common term used to describe this but is also known as Capital Budgeting ("economic
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