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it has been estimated that about 6000 phoenix companies operate in australia costing government and the community hundreds of millions of
q evaluate certainty equivalent coefficientillustration - presume the risky cash flow is rs 200000 and the riskless cash flow is rs 140000the
q describes the certainty equivalent coefficient methodintroduction - certainty equivalent coefficient process which makes adjustment against risk in
q evaluate of risk-adjusted discount rateillustration - from the following date state which project is preferableyearproject aproject
q show the disadvantages of adjusted discount rate1 the risk premium rates resolute under this method are arbitrary therefore this method maynt give
q show the advantages of adjusted discount rateadvantages-1 it is simple to understand and simple to calculate2 the risk premium rate comprised in
q what is risk adjusted discount ratethe risk adjusted discount rate includes two rates vizi risk-free rate - risk free rate is the usual rate or the
q explain risk adjusted discount rate methodin the risk adjusted discount rate method the future cash flow from capital projects are discount at the
q what do you signify by risk analysis in capital budgetingrisk analysis - risk in an investment demotes to the variability that is likely to observe
q what is disadvantages of irr method disadvantages of irr method-i computation of irr involves tedious calculationsii occasionally this method
q show the advantages of irr methodadvantages of irr method-i similar to the other dcf methods irr methods as well take into consideration the time
q explain the procedure to find out irrprocedure to find out irr- step i compute the fake payback period fake payback period initial cash
q demerits of profitability index methoddemerits of pi method-i this method is complicated to understand and implementii calculations in this method
q advantage of profitability index methodadvantage of pi method-i similar to the other dcf techniques the pi method as well takes into account the
q describe about profitability indexprofitability index or pi- second method of estimate a project through discounted cash flows is profitability
q demerits of net present value methodi difficult to understand as well as implement- this method is tricky to understand as well as implement in
q merits of net present value methodmerits of npv method-i time value of funds is taken into consideration - for the reason that this method takes
q explain net present value methodnet present value npv method - this process measures the present value of returns per rupee invested in this method
demerits of pay back method-i it ignores the cash flows after the pay back period - the main shortcoming of this method is that it completely ignores
q what is qualities of pay back methodqualities of pay back method-i simple - the most important merit of this method is that it is simple to
q show the accept-reject criteriaaccept-reject criteria- if the actual payback period is not more than the predetermined payback period project would
q explain about pay back methodpay back method pb - the payback process is the simplest method this method computed the number of years required to
q what is cash flow criteriacash flow criteria - cash flow criteria are on the basis of cash flows rather than accounting profit cash flow methods
q explain demerits of accept-reject criteriademerits of arr-i it utilizes accounting income rather than cash flows - the principal short coming of
q merits of accept-reject criteriamerits of arr-i simple - arr method is very simple to understand and useii complete life time of the project is