0
Capital budgeting entails decisions to commit present funds in long term investment in anticipation of future returns. The future is usually of long term nature spanning over five years. The amount of investment and the returns from the cannot be predicted with certainty due to certain variables like market for the product, technology, government policies, etc. The uncertainty associated with the investment and the returns is what makes decision makers to consider probabilty distributions in their estimates, hence, making capital budgeting to be considered under uncertainty and risk.
Wiki User
∙ 15y ago
Wiki User
∙ 14y agoTechniques of Evaluating Capital Budgeting Decisions.
Add your answer:
Earn +20 pts
3 types of financing decisions under financial management?
The three types of financial management decisions are capital budgeting, capital structure, and working capital.In Some case Dividend decision is also part of financial management part although dividend decision comes under capital structure
Distinguish between decision making under certainty and decision making uncertaintyMantion certain models for solving decision problem under uncertainty?
when you know all information about alternatives and the best chosen one is certainty when you donot know all information is uncertainty
What has the author Peter Haddawy written?
Peter Haddawy has written: 'Representing plans under uncertainty' -- subject(s): Uncertainty (Information theory), Decision making, Artificial intelligence
What has the author David E Bell written?
David E. Bell has written: 'Decision making under uncertainty'
What has the author George Wright written?
George Wright has written: 'Strategic decision making' -- subject(s): Decision making, Strategic planning 'Cultural and individual decision making under uncertainty' 'Cultural and individual differences in probabilistic set, discrimination of uncertainty and realism of probability assessments'
Solved aper of assignment of ms-9 MBA of ignou?
why is decision making under uncertainty necessarily subjective? explain gving examples.
What has the author Bruce F Baird written?
Bruce F. Baird has written: 'Managerial decisions under uncertainty' -- subject(s): Decision making
What has the author George K Chacko written?
George K. Chacko has written: 'Today's information for tomorrow's products' 'Decision-Making under Uncertainty'
What has the author Manh Hung Nguyen written?
Manh Hung Nguyen has written: 'Dynamic timing decisions under uncertainty' -- subject(s): Decision making, Mathematical models, Nonrenewable natural resources, Technological innovations, Uncertainty
What falls under PPBE?
What falls under Planning, Programming, Budgeting, and Execution
What is Hurwicz alpha criterion?
The Hurwicz alpha is a criterion for decision making under complete uncertainty that represents a comprimise between the Maximin and Maximax criteria. The alpha is a number between 0 and 1. In the special case where it is one, the criterion reduces to Maximin and in the special case where it is zero the criterion reduces to Maximax. The decision maker can set alpha to a number between zero and one according to his or her level of optimism. By "Decision Making Under Complete Uncertainty" it is meant that a decision table is available. This means that it is known which alternatives are available, which states of nature are possible, and what utility each alternative would derive in each possible state of nature. The "complete uncertainty" means that the probabilities of each state of nature occurring are unknown.
What has the author Cato Wadel written?
Cato Wadel has written: 'Communities and committees' -- subject(s): Social conditions, Community development, Newfoundland, Nfld Fogo Island, Fogo Island 'Capital management under extreme uncertainty' -- subject(s): Fisheries, Capital productivity, Economic aspects of Fisheries
