5
Evaluating Capital Investment Proposals
Learning Objectives
By the end of this chapter, you should be able to:
• List the elements in the capital budgeting process and the key issues to consider.
• Define the cost of capital or discount rate.
• Determine the cash flow from an investment.
• Describe the steps for assessing and measuring risk when making investment decisions.
• Evaluate capital investment proposals using at least six techniques.
• Describe the strengths and weaknesses of payback.
• Explain the role of the post-audit in the capital budgeting process.
Collaborating to Improve Investment Strategies
“As the next meeting began, ...
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