Content preview from Fundamentals of Financial Management, Third Edition
- What is capital rationing? What is the process of accepting a project in such cases?
- Limited availability of resources for investment is capital rationing.
- For accepting projects, the finance manager tries to utilise the entire available funds and, at the same time, to maximise the NPV.
- Explain the process of capital budgeting under inflationary conditions.
- Cash inflow, cash outflow and discount factor - all are treated for inflation and then NPV is calculated on the basis of treated figures.
- How is NPV of two mutually exclusive proposals with unequal lives calculated?
- There are two methods - one is annualised NPV method and the other is replacement chain method.
- In the first, the annualised NPV of the two proposals ...
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ISBN: 9789332508170