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SAB7#022 Project Selection Method

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SAB7#022 Project Selection Method
Payback Period
- Choose the nearest Date
- Payback period intuitively measures how long something takes to "pay for itself."
Present Value
- The operation of evaluating a present sum of money some time in the future is called a capitalization (how much will 100 today be worth in 5 years?)
Internal Rate of Return- IRR
- Choose the highest
- IRR is a rate of return used in capital budgeting to measure and compare the profitability of investments.
Cost-Benefit Analysis
- Choose above 1
- CBA is a systematic approach to estimating the strengths and weaknesses of alternatives that satisfy transactions, activities or functional requirements for a business.
Net Present Value - NPV
- Choose the highest
- NPV is determined by calculating the costs (negative cash flows) and benefits (positive cash flows) for each period of an investment
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- Mind Map on SAB7#022 Project Selection Method, created by David Hernandez on 01/08/2015.
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- David Hernandez
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