Archive | Capital Budgeting

How to Prepare a Pessimistic and Optimistic Budget? | Capital Budgeting

The following article will guide you to learn about how to prepare a pessimistic and optimistic budget of a firm. In decision-making the first step is usually to make a single 'best estimate' for each item. The worst possible/best possible outcomes can be evaluated from the pessimistic and optimistic attitudes of the decisions made. An optimistic decision maker consider the [...]

By |2023-01-30T18:30:11+05:30July 7, 2017|Capital Budgeting|Comments Off on How to Prepare a Pessimistic and Optimistic Budget? | Capital Budgeting
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How to Calculate Standard Deviation and Coefficient of Variation? | Capital Budgeting

The following article will guide you to learn about how to calculate standard deviation and coefficient of variation. Standard deviation is a statistical technique used in capital budgeting decisions to determine the variation or deviation from the mean of cash flows of the project. The project with lesser standard deviation in cash flows carries less risk and uncertainty. Risk is [...]

By |2023-01-30T18:30:17+05:30July 7, 2017|Capital Budgeting|Comments Off on How to Calculate Standard Deviation and Coefficient of Variation? | Capital Budgeting
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