capital budgeting

capital budgeting The process by which an organization appraises a range of different investment projects with a view to determining which is likely to give the highest financial return. The approaches adopted include net present value, the internal rate of return, the profitability index, and the payback period method.

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"capital budgeting." A Dictionary of Business and Management. 2006. Encyclopedia.com. 10 Feb. 2012 <http://www.encyclopedia.com>.

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