Value Leads to Better Investment(公司金融,英文版.pptVIP

Slides by Matthew Will Topics Covered NPV and its Competitors The Payback Period The Book Rate of Return Internal Rate of Return Capital Rationing NPV and Cash Transfers Every possible method for evaluating projects impacts the flow of cash about the company as follows. Payback The payback period of a project is the number of years it takes before the cumulative forecasted cash flow equals the initial outlay. The payback rule says only accept projects that “payback” in the desired time frame. This method is very flawed, primarily because it ignores later year cash flows and the the present v