## Capital Structure and Types Of Leverage

Capital Structure What Is Capital Structure? When you are asking about what the capital structure is and what it relates to what you will find is that it is regarding…

## NPV Decision Rule | Capital Budgeting Techniques

NPV Decision Rules  - Capital Budgeting Techniques Net Present Value is defined as the present value of all expected cash flows generated by the project minus present value of the…

## Project Analysis | Accounting Rate of Return

Project Analysis – Capital Budgeting Techniques   Nile’s Manufacturing is considering buying automated machinery that costs \$250,000. Working capital requirement is \$25,000 and they are expecting Annual cash savings of…

## Payback Period and ARR Example- Project Analysis

Project Analysis - Capital Budgeting Techniques Solved example of  Payback Period and ARR Steve has been appointed as finance director of a company. His only aim is to gain some experience…

## Project Analysis | Capital Budgeting Techniques

Project Analysis - Capital Budgeting Techniques Net Present Value Example We are considering following project for investment purpose. Initial cost of the project:           \$800,000 Project Life:…

## Criticism on Capital Asset Pricing Model

Criticism on Capital Asset Pricing Model It is pertinent to mention here that the CAPM theory is about the real world; but it does not describe the real world fully.…

## Capital Asset Pricing Model (CAPM) Definition, Assumptions and Calculation

Capital Asset Pricing Model (CAPM) What is CAPM? CAPM Assumptions  CAPM Formula How to calculate CAPM? Capital Asset Pricing Model CAPM stands for Capital Asset Pricing Model. Capital Asset Pricing Model (CAPM) defines…

## Discounted Cash Flows

Discounted Cash Flows - Capital Budgeting Techniques We have discussed earlier that accounting rate of return & payback period ignores time value of money and cash flow trends. Means cash…

## Accounting Rate of Return (ARR) | Capital Budgeting Techniques

Accounting Rate of Return - Capital Budgeting Techniques Accounting rate of return is the project evaluation technique which differs from other capital budgeting techniques because the focus of this technique is…

## Difference between Annuity Due and Ordinary Annuity

Annuity Due and Ordinary Annuity - Capital Budgeting Techniques We often encounter situations where we have multiple cash flows of same amount. A very common example of such cash flows is…