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Basic Appraisal Investment TechniquesName:Class:Teacher:Date:Before any company commits to any high levels of capital spend, the company under normal circumstances has to undertake an investment appraisal. An investment appraisal consists of these two features:i) An estimate of any future costs as well as benefits over the given project's life.ii) An assessment of the level of expected returns which will be earned for the level of investment made is performed (Elmaghraby, 1990)If a given company's proposed capital project is evaluated, the cost as well as the benefits of that given project should be keenly evaluated over the company's foreseeable life. Hence, this is now the anticipated useful life of the non-current asset to be purchased, which will hence become several years. Thus from this the company will understand that the estimates of any future costs as well as benefits demand a long-term forecasting (Shrieves, 2001). Basic appraisal techniques include Return on Capital Employed and Payback. Nevertheless, there are other complex investment appraisal methods being applied in companies as well as governmental institutions. These include: 1. NPV or the Net Present Value2. IRR or the Internal rate of Return.Net present Value (NPV)Appraising the general impact of a given project using the DCF technique will cause one to involve discounting all significant flows of cash related to the given project back to their present value or also known as (PV). Th

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