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'Zenith Mall' is a famous shopping mall in Mumbai, owned by 'Pinnacle Group'. It is very popular for its international and national brands of fashionable clothes, restaurants, cinema halls and food courts.
The management of Pinnacle Group has decided to open a new branch of the mall in Pune. This decision was very crucial for the management as it involves huge amounts.
The management of Pinnacle Group has decided to open a new branch of the mall in Pune. This decision was very crucial for the management as it involves huge amounts.
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Question : 35
Total: 45
State any two factors affecting the decision identified in (i) above.
Solution:
Factors Affecting Capital Budgeting Decisions are as follows:
1. Cash Flows of the Project: A series of cash receipts and payments over the life of an investment proposal is considered and analysed for selecting the best proposal.
2. The Rate of Return: The calculation of expected returns from each proposal and risk involved is taken into account to select the best proposal.
3. The Investment Criteria Involved: Various investment proposals are evaluated, based on capital budgeting techniques. These involve calculation regarding investment amount, cash flows, rate of return etc.
1. Cash Flows of the Project: A series of cash receipts and payments over the life of an investment proposal is considered and analysed for selecting the best proposal.
2. The Rate of Return: The calculation of expected returns from each proposal and risk involved is taken into account to select the best proposal.
3. The Investment Criteria Involved: Various investment proposals are evaluated, based on capital budgeting techniques. These involve calculation regarding investment amount, cash flows, rate of return etc.
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