Capital Budget Evaluation Techniques Below is a list of the more common capital budget evaluation techniques that companies use to make decisions...

Capital Budget Evaluation Techniques

Below is a list of the more common capital budget evaluation techniques that companies use to make decisions regarding capital investments. For the techniques, explain how it is computed, how to interpret the results, how it is used in the decision-making process, and provide at least one pro and one con of using that particular method. If commenting on a technique that has already been explained, be sure to expand on the prior explanation to make the post substantive. Please note that some of these techniques are not specifically covered in the text but are often used in evaluating capital investments/projects.

• Payback Period
• Discounted Payback Period
• Unadjusted Rate of Return (Simple Rate of Return)
• Net Present Value
• Present Value Index (Profitability Index)
• Internal Rate of Return
• Modified Internal Rate of Return