What are real options, and why are they important to capital budgeting?

Q: What is optimal capital budget?

A: Budget: The estimation of the income and expenditure of the particular future period and is…

Q: How to analyze capital budgeting decisions? Which measures are important and why?

A: Capital Budgeting process involve analyzing the cash in flow and outflow of a project, to determine…

Q: What information do we need for capital budget analysis?

A: A corporation's systematic method for analyzing possible large-scale expenditures or investments is…

Q: What is the main disadvantage of discountedpayback? Is the payback method of any realusefulness in…

A: The discounted payback method is a method of evaluating the payback period of the investment carried…

Q: Explain the term capital budgeting.

A: Capital Budgeting is used in strategic decision making. Capital budgeting is a process used to…

Q: Why is the capital budgeting decision important?

A: Capital Budgeting relates to decision of entity relating to either purchase of capital assets or…

Q: sion in capital budgeting?

A: A decision related to the investment in the long-term assets is known as the capital budgeting…

Q: Define the term capital budgeting.

A: Capital budgeting is the planning process used by companies to determine whether an organisation's…

Q: How does the payback period approach capital budgeting? Examples of 1 advantage and 1 disadvantage?

A: Pay back period approch in capital budgeting is use to analysis two or more projects. The project…

Q: In a capital budgeting study, explain why sunk costs should not be included, but opportunity costs…

A:

Q: Explain what is meant by the time value of money, and discuss its relevance to the capital budgeting…

A: Value of money means its purchasing power. It can also be explained as the quantity of goods that…

Q: Should capital budgeting decisions be made solely on the basis of project’s NPV?

A: Net present value is the method of capital budgeting, under this method the present value of future…

Q: If NPV is conceptually the best procedure for capital budgeting, why do you think multiple measures…

A: Capital Budgeting Techniques helps to decide the investment project that should be selected.

Q: Discuss the method of capital budgeting that you would use in your ownbusiness. Justify your…

A: Capital budgeting is the process by which various investment alternatives can be evaluated. There…

Q: Are the following capital budgeting or financing decisions?

A: Capital budget involves the evaluation and comparison of costs and benefits from a project. Capital…

Q: What does effective capital budgeting require?

A: Capital budgeting is the process of evaluating large-scale investments or expenditures. The…

Q: What is capital budgeting?

A: The Capital Budgeting, in simple terms, is the process of evaluating which project to choose in…

Q: Do you think capital budgeting is important? Justify

A: Capital budgeting is a process of investing into capital expenditure. Capital expenditure is an…

Q: What is a capital budgeting technique that generates decision rules and associated metrics for…

A: The capital budgeting technique help to evaluate the acceptibility and rejection of a particular…

Q: What is meant by the term payback period? How is this criterion sometimes used in capital budgeting?

A:

Q: what is capital budget analysis?

A: Every business needs funds to manage it's business and utilisation of funds should be done in…

Q: What exactly is the analytic hierarchy process (AHP) and how can it be used in the context of…

A: The Answer:

Q: WHAT ARE THE PROBLEMS WITH IRR APPROACH TO CAPITAL BUDGETING?

A: IRR internal rate of return is very common method of capital budgeting decisions making.

Q: Are the engineers responsible for making capital budgeting decisions?

A: Capital budgeting decisions are the decisions which are concerned with the allocation of limited…

Q: Define Capital budgeting.

A: Capital budgeting is used by management to know  which projects will give the best return during  a…

Q: What are the various costs that must be evaluated in a capital budgetingdecision?

A: Capital budgeting is the process of planning to make a decision to invest in long period investments…

Q: Explain Capital Budgeting? Mention the decision-making process of all capital budgeting techniques.

A: Capital budgeting refers to the process of making investment decisions in capital expenditure.…

Q: What are the critical steps involved in the capital budgeting process?

A: Capital budgeting process : Capital budgeting is the process of choosing ideal investment project…

Q: What types of projects require the least detailed and the most detailed analyses in the capital…

A: Capital budgeting is a corporate method that determines future large ventures or investments.…

Q: Give a conclusion about capital budgeting and its techniques.

A: Capital budgeting is the technique that is employed by businesses to make an evaluation of major…

Q: Why is the NPV the primary capital budgeting decision criterion?

A: NPV( net present value) is a method to determine the current value of all the cash flows which are…

Q: One of the modern methods of Capital Budgeting is:

A: The correct answer is a. Profitability Index

Q: What is the major criticism of the payback and simple rate of return methods of making capital…

A: Cash payback method: Cash payback period is the expected time period which is required to recover…

Q: What is the major short coming of using the payback period as the only criterion in making capital…

A: ANSWER    the major short coming of using the payback period as the only criterion in making capital…

Q: What two pieces of information does the payback method providethat are absent from the other capital…

A: The question is based on the concept of calculation of payback period as a capital budgeting…

Q: Which is one of the most important parts of the capital budgeting process? Explain with an example?

A: The Decision-making phase is the most vital part of the capital budgeting process and it is…

Q: Why should the company consider Capital Investment Decision and why there's capital budgeting on it?

A: Capital investment decisions involve the judgments made by a management in regard to how funds…

Q: Explain the decision-making criteria in Capital Budgeting with the satiable example.

A: Capital budgeting is the process that a business uses to determine whether proposed fixed asset…

Q: What are the three types of risk that are relevant in capital budgeting?

A: Capital budgeting (or investment appraisal) is the planning process used to determine whether an…

Q: Why is the WACC used in capital budgeting?

A: Every company consists of its own set of capital structures including retained earnings, equity…

Q: 1. Why is the WACC used in capital budgeting?

A: Solution- Weighted Average Cost of Capital (WACC)-         The weighted average cost of capital…

Q: What is capital budgeting? What are the techniques of capital budgeting?

A: Capital budgeting Capital budgeting involves taking decisions related to investments in long-term…

Q: What factors should you keep in our mind as a financial manager when selecting methods of capital…

A: Capital budgeting is the method through which financial managers are able to make decisions related…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.