What is the logic behind the npv capital-budgeting framework

Assignment Help Marketing Management
Reference no: EM132221031

Assignment 2: Capital-Budgeting Criteria

The net present value (NPV) of a project is a measure of the difference between the project's value and its cost. The internal rate of return (IRR) is another measure of the project's attractiveness. These are by far the two most widely used measures for evaluating the value of capital investment projects.

NPV and IRR are the focus of this discussion assignment. Your response should be one or two paragraphs in length for each of the following questions:

• What is the logic behind the NPV capital-budgeting framework?

• Would changes in the cost of capital ever cause a change in the IRR ranking of several projects?

• When it is clear that a project will be profitable, why should it be rejected if it has a negative net present value?

• Why should cash flow to be received at the end of six years be discounted more heavily than cash flow to be received at the end of five years?

Reference no: EM132221031

Questions Cloud

Discuss the pricing and distribution strategies : In this module you will prepare a report that discusses the pricing and distribution strategies. Research the following topics for the latest information.
What service industry has impressed you the most : What service industry has impressed you the most with its innovativeness? Write your answer in the below format.
What does the research say : Evaluate a chosen literacy practice in which you currently engage with regularly using the Australian Curriculum.
Write reflection with one big branding : Write reflection (300 - 500 words) with one big branding takeaway from EACH article. Read Online: "Who Are The Year's Best Loved Brands?
What is the logic behind the npv capital-budgeting framework : What is the logic behind the NPV capital-budgeting framework? Would changes in the cost of capital ever cause a change in the IRR ranking of several projects?
How marketers use primary data and secondary data : Discuss how marketers use primary data and secondary data, and provide some examples. The response must be typed, single spaced.
What are the favorite research approaches or techniques : Many marketing researchers have their favorite research approaches or techniques. Some researchers maintain that the only way to really learn about consumers.
Discuss authentic leadership and leader-member exchange : What is the relationship between authentic leadership, Leader-Member Exchange (LMX) and employees' Psychological Capital (PsyCap)?
How the given phenomenon has affected you : Along the way there have been supporters and opposers of his views. However it is fair to say that each of us have experienced the impact of globalization.

Reviews

Write a Review

Marketing Management Questions & Answers

  Attitudes and bargaining behaviors of the participants

Do you think the attitudes and bargaining behaviors of the participants in collective bargaining negotiations are more or less important in the final outcome than economic conditions and factors? Why

  How potential customer make decisions in choosing restaurant

Use the appropriate concepts, models and theories of Decision Making to explain how potential customer makes decisions in choosing the restaurant

  Explain information age and pricing strategy

Explain Information Age and Pricing Strategy and this solutions highlights various factors that enabled businesses to introduce innovative pricing strategies to their customers

  Suggest ways automobile makers can use social media

Suggest ways automobile makers can use social media through new digital devices in today's cars to safely create customer engagement and customermanaged relationships.

  Explain linear programming model for bicycle manufacturer

Explain Linear programming model for bicycle manufacturer and Write down the optimization statement for the objective function

  Advantages and challenges of social media marketing

Will the FTC's requirements regarding ads and endorsers make Twitter less effective as an advertising medium?

  Why is passion such an important characteristic of

dq1.why is passion such an important characteristic of successful entrepreneurs? what is it about passion that makes it

  Which generational demographics will you target

BMKT-9103 Geographically, which region do you suggest your company target? Which generational demographics will you target? In which area of the state will you attempt to achieve the greatest distribution?

  Describe the key factors such as demographic and economic

Describe the key factors, such as demographic, economic, natural, technological, political, and cultural developments, that affect marketing strategies

  Identify current products that are on the market today

Identify current products that are on the market today and discuss the following: Select separate products as an example of each of the stages of the Product Life Cycle concept

  How each objective aligns directly to an organizational goal

Create advertising and public relations objectives that align to each one of the bank's strategic goals. Be sure to use the specific, measurable, achievable.

  What can up-and-coming social networks learn from facebook

If you were a marketing executive with a multi-million dollar budget, how would you approach social media? Which Web sites, and what sorts of campaigns would you focus on (if any)? Would you buy paid advertising on Facebook? Explain your reasoning..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd