Merits of net present value method, Financial Management

Assignment Help:

Q. Merits of net present value method?

Merits of NPV method:-

(i) Time value of funds is taken into consideration: - For the reason that this method takes into account the time value of money it is the best method to utilize for long range decisions.

(ii) Entire Life of the project is taken into consideration: - This process takes into account the fall life of the project and not only the payback period.

(iii)Wealth Maximisation: - Wealth maximization objective of the business is achieved by this method. Besides accepting the project with highest NPV the wealth of the business is maximized.


Related Discussions:- Merits of net present value method

Traditional mortgages, In US, savings and loan associations con...

In US, savings and loan associations constitute the major originating group of the traditional loans. What types of properties can be mortgaged?

Who owns a credit union, Who owns a credit union? Explain. The term Cre...

Who owns a credit union? Explain. The term Credit unions are owned by their members. While credit union members put money in their credit union, they are not exactly "depositin

Case let, This case has been framed in order to test the skills in evaluati...

This case has been framed in order to test the skills in evaluating a credit request and reaching a correct decision. Perluence International is large manufacturer

Explain how eurocurrency is created, Explain how Eurocurrency is created. ...

Explain how Eurocurrency is created. Answer: The center of the international money market is the Eurocurrency market. A Eurocurrency is a time deposit of money in an internationa

Why is the replacement value of assets method, Why is the replacement value...

Why is the replacement value of assets method not generally used to value complete businesses? The replacement value of assets method isn't often applied to entire business val

Define the primary reasons that companies hold cash, What are the primary r...

What are the primary reasons that companies hold cash? Companies hold cash to make essential payments, to take benefit of opportunities as they arise, and to cover unforeseen eme

Finance, Ask questiSuggestion regarding Credit limit. Should it be approved...

Ask questiSuggestion regarding Credit limit. Should it be approved or not, what should be the amount of credit limit that electronics give to Booth Plastics.

Examine about environmental analysis, Examine about Environmental (external...

Examine about Environmental (external) analysis "A study that considers potential environmental effects during planning phase before an investment is made or an operation start

Securities, Calculate the expected rate of return and risk of return

Calculate the expected rate of return and risk of return

CASE, How would you judge the potential profit of Bajaj Electronics on the ...

How would you judge the potential profit of Bajaj Electronics on the first year of sales to Booth Plastics and give your views to increase the profit.

Write Your Message!

Captcha
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