Answer to Question #246599 in Finance for Neha

Question

Capital budgeting can be described as the mechanism by which businesses determine the purchasing of major fixed assets such as machinery, equipment, and buildings, as well as the acquisition of other businesses, either through the purchase of equity shares or a group of assets, to conduct ongoing operations. Discuss any five of the basic techniques of capital budgeting

Answer 1

Capital budgeting involves several methods of analysis which may be utilized in determining capital investment's economic feasibility. Capital budgeting techniques include profitability index, internal return rate, net present value as well as discounted payment period.