What is meant by the term payback period? How is this criterion sometimes used in capital budgeting?

Should financing costs be included as an incremental cash flow in capital budgeting analysis?    Explain fully.

Are the engineers responsible for making capital budgeting decisions?

What basic capital budgeting technique(s) you would use to accurately assess cash flow when taxes are considered. Support the rationale.

What are the various costs that must be evaluated in a capital budgetingdecision?

h. What does the term “risk” mean in the context of capital budgeting; to what extent can risk be quantified; and, when risk is quantified, is the quantification based primarily on a statistical analysis of historical data or on subjective, judgmental estimates? i. 1. What are the three types of risk that are relevant in capital budgeting? 2. How is each of these risk types measured, and how do they relate to one another? 3. How is each type of risk used in the capital budgeting process? j. 1. What is sensitivity analysis? 2. Perform a sensitivity analysis on the cost per unit, unit sales, and salvage value. Assume each of these variables can vary from its base-case, or expected, value by plus or minus 10%, 20%, and 30%. Include a sensitivity graph, and discuss the results. 3. What is the primary weakness of sensitivity analysis? What is its primary usefulness?

What are real options, and why are they important to capital budgeting?

What is capital budgeting? Explain various steps in its preparation and throw light on its limitations.

How is the estimation of relevant cash flows one of the most important parts of this capital-budgeting process?

Use an example to explain to show why capital budgeting relies on cash flows rather than net income?