Theoretical Foundations of Capital Investments and Investment Appraisal
This chapter provides a basic understanding of capital investments in general. The first part introduces the fundamentals of capital investments, including their key characteristics and classifications. The second part of this chapter covers decision theory and establishes the basic concept of rationality as foundation for a decision model. The third part finally addresses investment appraisals and discusses major investment appraisal techniques that are used to evaluate capital investments.
KeywordsCash Flow Capital Investment Decision Model Decision Theory Payback Period
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