Question

becuause of the expenense of applying multipe techniques,managers should use a single budgeting technique to analyze...

becuause of the expenense of applying multipe techniques,managers should use a single budgeting technique to analyze potential capital investments

T/F

Homework Answers

Answer #1

False

Every Investment proposal needs different set of calculations to understand its feasibility.

One set of budgeting technique cannot be applied to every potential Capital investment decision.

Long term Investments are analyzed in different way than Short term Investments.

Expense incurred in applying multiple techniques is necessary for a better decision. The financial performance of the Investment depends on these analysis and should be done in a proper way by the managers.

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
In taking capital budgeting decisions, financial managers are advised to use more than one capital budgeting...
In taking capital budgeting decisions, financial managers are advised to use more than one capital budgeting technique for consistency, reliability and accuracy in capital budget decisions. Although the Net Present Value (NPV) capital budgeting technique is required in most capital budgeting discussion processes, it may sometimes have conflicting decision with Internal Rate of Return (IRR) under certain conditions. Briefly state the conditions under which NPV and IRR results in conflicting decisions and how the financial manager can resolve this conflict?
What is the reason that companies should use different capital budgeting techniques, namely discount rate calculation...
What is the reason that companies should use different capital budgeting techniques, namely discount rate calculation models, for domestic and international projects? Give examples from the AES case.
1.Capital budgeting is for situations in which managers must plan significant outlays for projects that have...
1.Capital budgeting is for situations in which managers must plan significant outlays for projects that have long term implications. T F 2.Capital budgeting is for situations in which large amounts of money usually involved. T F 3.One of the considerations in investment decision considerations is choosing the project with the most profitable return on available funds. T F
The technique for incorporating Risk into capital budgeting that involves the use of numbers drawn randomly...
The technique for incorporating Risk into capital budgeting that involves the use of numbers drawn randomly from probability distributions is called a: a. sensitivity analysis. b. scenario analysis. c. probability simulation. d. Monte Carlo simulation.
What would be the best technique to analyze how much money a bank should have on...
What would be the best technique to analyze how much money a bank should have on hand? How would sas miner help achieve this goal?
When projects involve certain, or constant, cash flows, the capital budgeting analysis that can be conducted...
When projects involve certain, or constant, cash flows, the capital budgeting analysis that can be conducted is very simple and straightforward. Unfortunately, this type of project rarely exists. When a project’s cash flows, or the conditions that affect their magnitude or timing, vary from their expected values, then the analysis becomes more complicated. Projects that have the potential to exhibit greater or lesser levels of risk than the firm’s average, or normal, level means that adjustments should be made to...
In your homework for Chapter 9, you used the following techniques for analyzing projects: Payback Rule...
In your homework for Chapter 9, you used the following techniques for analyzing projects: Payback Rule Discounted Payback Period Net Present Value Internal Rate of Return Why must corporate managers use multiple techniques of project evaluation? Which technique is most commonly used and why? Describe several ways you may be able to use the techniques above as you progress in your professional career. (Identify specific types of projects you could analyze and discuss the advantages and disadvantages of using the...
identify and discuss at least 2 different techniques that a stockholder can use to motivate managers...
identify and discuss at least 2 different techniques that a stockholder can use to motivate managers to maximize stock for a company.
The decision process Before making capital budgeting decisions, finance professionals often generate, review, analyze, select, and...
The decision process Before making capital budgeting decisions, finance professionals often generate, review, analyze, select, and implement long-term investment proposals that meet firm-specific criteria and are consistent with the firm’s strategic goals. Companies often use several methods to evaluate the project’s cash flows and each of them has its benefits and disadvantages. Based on your understanding of the capital budgeting evaluation methods, which of the following conclusions about capital budgeting are valid? Check all that apply. For most firms, the...
Which of the following statements regarding relevant (i.e. incremental) cash flows is(are) true? I. Managers should...
Which of the following statements regarding relevant (i.e. incremental) cash flows is(are) true? I. Managers should not consider opportunity costs when making capital budgeting decisions. II. Managers should not consider sunk costs when making capital budgeting decisions. III. An externality is an effect of a project on the firm that is not reflected in the project’s cash flows.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT