| 1. | Advantages; It is easy to calculate than other capital budgeting decision rules.
|
| 2. | Managers make capital budgeting decisions while capital providers make decisions about lending and investment.
|
| 3. | The typical application of real options is to capital budgeting type problems as described.
|
| 4. | It comes down to capital budgeting and cash flow.
|
| 5. | Dixit & Pindyck used dynamic programming for capital budgeting.
|
| 6. | Avinash Dixit and Robert Pindyck showed the value of the method for thinking about capital budgeting.
|
| 7. | It includes how to raise the capital and how to allocate capital, i . e . capital budgeting.
|
| 8. | However for capital budgeting, finance theory holds that NPV using the firm's cost of capital is a superior metric.
|
| 9. | Thus, when choosing between " mutually exclusive projects ", more than one project may satisfy the capital budgeting criterion.
|
| 10. | EAC is often used as a decision making tool in capital budgeting when comparing investment projects of unequal lifespans.
|