SUMMARY
The process of evaluation of proposals from the viewpoint of long-term investment is known as capital budgeting. It is significant from the viewpoint of maximising corporate wealth.
Proposals relate either to the expansion of existing activities or to replacement of assets or to some strategic activities, such as investment on research and development or to safety and the environment. The consecutive steps in this process are identification of long-term goals, screening of proposals, project evaluation, project implementation, control and project audit. The projects to be evaluated are either independent projects or dependent projects, such as complementary projects, substitute projects and mutually exclusive projects.
The entire evaluation ...
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