Capital budgeting is a complicated process that is essential to organization's making good investment decisions.
Please give an example of a capital budgeting decision a company might need to make.
Once a business computes its cost of capital, how does a manager decide whether to take on a project or not?
What considerations might inform the decision?
This discussion is more interesting if we review financial literature to identify and present a description of one actual capital project/product failure and the reasons attributed to the failure.
Some illustrated examples of failed projects/products over the last 50 years you may want to look up and consider:
- New Coke,
- The Iridium Satellite Communication,
- the Edsel automobile, Beta (vs. VHS), the Concord SST, and various Dot Coms.
Feel free to research others.