You're a recent graduate of Champlain College and landed a great job in New York as a junior financial analyst for Chuck Schwable, a leading investment firm whose name bears no resemblance to a well known investment firm. Schwable has recently been hired by Giggle, a leading tech giant, to provide some capital budgeting recommendations for a major building project in downtown Manhattan. This is it…it's your big chance to make a great first impression and show off the skills you gained in your MGMT 240 finance class.
The senior financial analyst in your office asks you to provide a general synopsis of three common capital budgeting techniques: payback analysis, discounted cash flows analysis, and throughput analysis. Your synopsis will be presented to a small group of very important Giggle stakeholders who know nothing about capital budgeting.
For your synopsis (use fictitious data, if applicable):
- Describe each technique and how it pertains to making capital budgeting decisions
- Explain the benefits each technique has
Sample Solution