Tuesday, April 23, 2019

Response to Comments Essay Example | Topics and Well Written Essays - 250 words

Response to Comments - taste ExampleAll accountants and financial analysts realize that money losses value over time out-of-pocket to inflation. Back in the 1960s the money these people had was worth twice as much as todays money because our elders had greater buying power due to the fact money had not depreciated like it has in today economy. DQ2 When a company is using the NVP value method a soused should only accept a chore if the project has a NPV above cero. In your response I believe you mentioned that a company could do badly irrelevant of the NPV being above cero. Well this could encounter because the NPV analysis is limited to the project that the analysis is evaluating. If a firm has financial troubles that existed irrelevant of the results associated with the NPV of a project then a firm could go down under. The NPV analysis is not a tool that lavatory be used to evaluate the overall standing of a firm. The stage setting of an NPV analysis is limited to the scope of the project that the financial tool is used for (Besley & Brigham, 2000). The NPV tool can help managers determine the viability of a bang-up project. References Besley, S., Brigham, E. (2000). Essential of Managerial Finance (12th ed.). Fort Forth The Dryden Press.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.