![]() And we talked about several different decision rules used in practice beginning with the NPV rule which is nothing more than the difference between the present value of costs and the present value of benefits. So we introduced the topic discounted cash flow analysis by discussing decision-making. Today we're going to start in on Lecture 2 of Discounted Cash Flow Analysis, but before doing so, let's do a brief recap of our last lecture. Hey everybody welcome back to corporate finance. Today I want to talk about free cash flows, a critical element in implementing any of those decision rules. We also discussed how in practice we should be taking a practical approach, and using the relevant information from all three rules. We discussed several different decision criteria focusing in particular on three, the NPV rule, the IRR rule, and the pay back period. ![]() Last time we introduced the new topic discounted cash flow analysis by discussing how corporations or people more generally should be making decisions. ![]()
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