Engineering Economy Special Problems in Investment Decision Methods (Slides)

INVESTMENT DECISION MAKING: FOR FIRM AND PROJECT VALUATION, Forthcoming

4 Pages Posted: 25 Jan 2011 Last revised: 27 Feb 2013

See all articles by Ignacio Velez-Pareja

Ignacio Velez-Pareja

Grupo Consultor CAV Capital Advisory & Valuation

Date Written: January 24, 2011

Abstract

This is a course material (slides in pdf format) from the book Investment Decision Making. For Firm and Project Valuation. The book is originally in Spanish and is untitled as Decisiones de inversión. Para la valoración financiera de proyectos y empresas.

Chapter Four includes the study of different problems when working with the typical methods for financial decision making. This includes non constant discount rates, uneven periods, and the solution of contradictions among methods: Net Present Value, Internal Rate of Return and Profitability Ratio or Benefit Cost Ratio. For solving the inconsistencies the Weighted Internal rate of Return and the expanded Benefit Cost Ratio are proposed.

Keywords: NPV, IRR, Cost-Benefit Ratio, Net Present Value, Weighted Internal Rate of Return, Expanded Benefit Cost Ratio

JEL Classification: G31

Suggested Citation

Velez-Pareja, Ignacio, Engineering Economy Special Problems in Investment Decision Methods (Slides) (January 24, 2011). INVESTMENT DECISION MAKING: FOR FIRM AND PROJECT VALUATION, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1747305 or http://dx.doi.org/10.2139/ssrn.1747305

Ignacio Velez-Pareja (Contact Author)

Grupo Consultor CAV Capital Advisory & Valuation ( email )

Ave Miramar # 18-93 Apt 6A
Cartagena
Colombia
+573112333074 (Phone)

HOME PAGE: http://cashflow88.com/decisiones/decisiones.html

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