CapitalBudgeting_201.. - CITT

More documents

Recommendations

Info

The Concept of the Cost of Capital • when the firm's rate of return is the same as its cost of capital on an investment project, the price of its common shares normally remain unchanged following the acceptance and implementation of the project, • and… ©2012, Varmelous Ind. Inc. -- Slide 6
The Concept of the Cost of Capital • when the firm earns a greater rate of return than its cost of capital, the greater return will normally increase the value of the firm’s common shares and consequently, an increase in shareholder wealth. • Important to remember.. – The minimum rate of return that an investment is expected to provide in order to justify its acquisition is known as the hurdle rate, cost of capital, cut-off-rate, or discount rate, or the required rate of return (RRR). ©2012, Varmelous Ind. Inc. -- Slide 7
Page 1 and 2: Capital Budgeting Learning Outcomes
Page 3 and 4: The Concept of the Cost of Capital
Page 5: The Concept of the Cost of Capital
Page 9 and 10: Difficulty and importance in findin
Page 11 and 12: Capital Budgeting • When evaluati
Page 13 and 14: Capital Budgeting • Cash Flows: -
Page 15 and 16: Capital Budgeting • Discounted Ca
Page 17 and 18: Discounted Cash Flow - Net Present
Page 39 and 40: Discounted Cash Flow - (IRR) IRR DC
Page 41: About the presenter • Michel has

CapitalBudgeting_201.. - CITT

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?