Comparison between modern and traditional methods, Finance Basics

Comparison between Modern and Traditional Methods

Both modern and traditional methods will indicate or show strong weaknesses which like a company cannot use either to choose a viable venture and for this purpose the choice of the investment will depend on that method the company has recognized it can meet its investment requirements.  The selection should not be limited to one method however at least 2 modern methods.  During all, when ranking projects, a conflict will increase between NPV and IRR especially beneath the following conditions as:

i)   If the lives of the projects are not same.

ii) Where the cash outlay is larger quite than another.

iii) When the cash flow pattern differs that is the cash flows of one project may overtime rise while those of the other reduce. During this case NPV may provide consistently correct solution especially hence as it does not yield multiple rates.

Posted Date: 1/31/2013 1:23:29 AM | Location : United States

Related Discussions:- Comparison between modern and traditional methods, Assignment Help, Ask Question on Comparison between modern and traditional methods, Get Answer, Expert's Help, Comparison between modern and traditional methods Discussions

Write discussion on Comparison between modern and traditional methods
Your posts are moderated
Related Questions
Volpe Corporation produces class rings to sell to college and high school students. These rings sell for $75 each, and cost $30 each to produce. Volpe Corporation has fixed costs o

Question 1: (a) What do you meant by the term ‘Life Insurance Contract'? (b) Many people prefer to choose Single life policies compared to Joint life policies. Why is t

Fixed income security can be defined as the financial obligation of an entity (known as the issuer), which promises to pay a specified amount of money on a pre-sp

Objectives or Goals of Business 1. Profit maximization - This is a traditional and a cardinal objective of a business.  This is so for the following purpose: To

Mr. and Mrs. smith are considering the purchase of a house. They can afford to make  a mortgage payment of $750 per month. If the current mortgage interest rate is 9% with monthly

Forms of Business Organizations The term business is wide in meaning. It includes all human activities made for the sake of earning profits through the process of production of

Suggestion regarding Credit limit. Should it be approved or not, what should be the amount of credit limit that electronics give to Booth Plastics.

What are the principles of multiunit finance?

Consider the following capital market yielding 1% per year and a mutual fund consisting of 60% stocks and 40% bonds. expected return of stocks 9.75% per year and expected return on

1. A stock pays no dividend and is expected to be sold for $50 after 4 years. If the investor's RRR is 12%, at what price is he/she willing to buy it? 2. ABC company has its ROE