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Traditional Capital Budgeting Techniques
These techniques are usually very simple and easily catchable. But the fundamental drawback of these methods is that they don't consider the time value of money. But in many industries where an instant decision is to be taken, these techniques offer the quicker way out. There are generally two techniques under this category of methods. That is - Accounting rate of return and Payback period.
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What are the Weaknesses of the traditional approach The traditional approach to the scope of finance function evolved during 1920s and 1930s and dominated academic during 40's
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