Term
| how do capital expenditures differ-3 |
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Definition
involve large sums of money
arne't regular recoccuring
commit pharmacy long-term |
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Term
| external pressures are the effcts of -3 |
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Definition
| competiiton, demand, technology |
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Term
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Definition
firm;s cost structure
management expectations |
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Term
| what are the types of cpaital investments-4 |
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Definition
replacemnet
cost reduction
expansion
new products |
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Term
| capital investments are accepted with a NPV > - |
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Definition
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Term
| what is the final step of a capitla budegting process |
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Definition
| post-audit- compare actual results with predicted |
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Term
| what makes up the interest rate of a lender |
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Definition
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Term
| what makes up the time value of money |
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Definition
- recpiet is wanted sooner than later
-the risk of sum not being repaid
-inlfation |
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Term
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Definition
| a dlloar today is worth more than in future, you could use is and earn interest |
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Term
| what is the amount to be recieved at the end of a period |
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Definition
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Term
| this is the curernt value of the specified amount to be recieved at a future date |
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Definition
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Term
| what is the method of adjusting cash inflow adn outflows to be comparable for investment |
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Definition
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Term
| what does a business need to choose to discount cash for net present value |
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Definition
| RRR (required rate of return) |
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Term
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Definition
| the rate of return to be financially attractive |
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Term
| as RRR increases what happen to NPV (net present value) |
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Definition
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Term
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Definition
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Term
| what do you determine cost of capital |
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Definition
| average cost of detbt and equity |
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Term
| Higher risks need high or low RRR? |
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Definition
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Term
| if a project is crucial for company- do they want a high or low RRR |
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Definition
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Term
| what cash outflow will decrease income tax |
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Definition
| purchase non current asset and get depreciation |
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Term
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Definition
| add. cash inflow from use of asset |
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Term
| what chas inflow results in hgiher income tax |
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Definition
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Term
| when does the net present value equal zero |
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Definition
| internal rate of return (IRR) |
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