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What are the pros and cons of the various capital budgeting decision methods (NPV, IRR, MIRR,...

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Finance

What are the pros and cons of the various capitalbudgeting decision methods (NPV, IRR, MIRR, PB, DPB)? If you had topick one method to use for all project valuation situations, whichone would you pick, and why?

Please explain your answer! I am trying to understandthe concept.

Answer & Explanation Solved by verified expert
4.2 Ratings (659 Votes)
PARTICULARS PROS CONS NET PRESENT VALUES IT CONSIDERS THE TOTAL CASH INFLOWS GENERATED BY A PROJECT OVER ITS LIFE TIME PRESENCE OF TIME VALUE OF MONEY FACTOR IN EVALUATING THE MUTUALLY EXCLUSIVE PROJECT THIS TECHNIQUE IS BEST SUITABLE NOT SUITABLE FOR PROJECTS HAVING UNEQUAL LIVES AND WITH LIMITED FUNDS INVOLVES CALCULATIONS WITH    See Answer
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What are the pros and cons of the various capitalbudgeting decision methods (NPV, IRR, MIRR, PB, DPB)? If you had topick one method to use for all project valuation situations, whichone would you pick, and why?Please explain your answer! I am trying to understandthe concept.

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