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List six procedures for screening projects and deciding which to accept or reject?

List six procedures for screening projects and deciding which to accept or reject?

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Answer #1

* Arrive the net cash inflow for the project and get the cost of capital for the firm.

* Arrive the Present value of the annaul cash flow for the project for till the life of the project.

*Find the net present value (PV of total cash flow-Initial investment).

* The more the NPV project is more profitable. Decide on the basis of ranks assigned on them on the basis of NPV.

*We can also decide on the basis of Payback period and also on the basis of Profitable index.

*Some projects having more NPV but a longer payback period due to gradual rise in cashflow. so in these cases the decission may get changed .

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