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2023•World Journal of Advanced Research and ReviewsOpen access

Comparison of capital budgeting methods: NPV, IRR, PAYBACK PERIOD

Ardyn Sari Sinaga, Maya Macia Sari, Anggi Andini Hutasuhut, Safina Tu Zahara, Ayu Amanda, Anisa Fitri, Muhammad Arief Caesario

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Abstract

In the era of globalization, every company is required to have high competitive ability because the competition that must be faced by companies will be increasingly stringent. In this study discusses whether or not the investment that will be made by the company is feasible. Calculation of the feasibility of this investment using the Capital Budgeting method. Based on the application of Capital Budgeting, methods that are generally used to analyze an investment project include Net Present Value (NPV), Internal Rate of Return (IRR), Payback Period (PP). Capital budgeting analysis is very helpful for companies in conducting research and analysis regarding the feasibility of an investment project planned by the company.

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In the era of globalization, every company is required to have high competitive ability because the competition that must be faced by companies will be increasingly stringent. In this study discusses whether or not the investment that will be made by the company is feasible. Calculation of the feasibility of this investment using the Capital Budgeting method. Based on the application of Capital Budgeting, methods that are generally used to analyze an investment project include Net Present Value (NPV), Internal Rate of Return (IRR), Payback Period (PP). Capital budgeting analysis is very helpful for companies in conducting research and analysis regarding the feasibility of an investment project planned by the company.

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Available abstract

In the era of globalization, every company is required to have high competitive ability because the competition that must be faced by companies will be increasingly stringent. In this study discusses whether or not the investment that will be made by the company is feasible. Calculation of the feasibility of this investment using the Capital Budgeting method. Based on the application of Capital Budgeting, methods that are generally used to analyze an investment project include Net Present Value (NPV), Internal Rate of Return (IRR), Payback Period (PP). Capital budgeting analysis is very helpful for companies in conducting research and analysis regarding the feasibility of an investment project planned by the company.

Key concepts: Payback period, Capital budgeting, Net present value, Internal rate of return, Investment (military), Rate of return, Return on investment, Modified internal rate of return

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