NPV Profile
Computing the NPV and IRR of a project to determine which project(s) among many others to undertake is not always as easy and straightforward as it seems. The IRR and NPV can, in fact, produce different ranking outcomes whenever mutually…
Mutually Exclusive Projects
Several project interactions make the incremental cash flow analysis very challenging for analysts. Specifically, the evaluation of capital projects, as well as their selection, may be greatly affected by the extent to which there are mutually exclusive projects and project…
Basic Principles of Capital Budgeting
Since capital budgeting describes the process by which all companies make decisions on their capital projects, it is not unusual for some fairly sophisticated techniques to be employed in its execution. Regardless of this, capital budgeting relies heavily on just…
The Capital Budgeting Process
Capital budgeting describes the process which companies use to make decisions on capital projects, i.e., projects whose lifespans can either be one year or more than one year. It is a cost-benefit exercise that seeks to produce results and benefits…
Environmental Factors in Investment Analysis
Pollution prevention, energy efficiency, reduced emissions, and adherence to environmental safety and regulatory standards are some of the key environmental factors which are considered in the investment analysis process. Concerning the influence of social factors on investment, the investment analysis…
Stakeholder Management
Proper stakeholder management is critical to the success of any organization. It involves taking appropriate steps to identify, prioritize and understand each stakeholder group so as to manage them effectively. Effective communication and engagement are, therefore, necessary if an organization…
Expansionary and Contractionary Monetary Policies
Contractionary and expansionary policies involve modification of the level of money supply in an economy. An expansionary policy increases the supply of money in an economy. On the other hand, a contractionary policy decreases the supply of a country’s currency.
Expansionary and Contractionary Fiscal Policies
Fiscal policies are carried out by the legislative and sometimes, the executive branch of the government. The two main instruments of fiscal policy are taxes and government expenditure. The government amasses taxes to finance its expenditures. Therefore, fiscal policy can…
Monetary and Fiscal Policies
Both monetary policy and fiscal policy can be utilized in an attempt to influence the economy. These measures do not compete against each other. Instead, they complement each other. However, the impact of the two policies may vary or even…
