Assessment 5: Capital Budgeting

Perform calculations and answer questions related to capital budgeting.

In this assessment, you will explore capital budgeting, which is the process of evaluating the feasibility and selection of investment projects. You will examine basic capital budgeting techniques, such as payback, discounted payback, net present value (NPV), internal rate of return (IRR), profitability index (PI), and modified internal rate of return (MIRR).

Introduction

This assessment focuses on capital budgeting calculations.

Instructions

Complete and submit the Assessment 5 Template [XLSX].

Competencies Measured

By successfully completing this assessment, you will demonstrate your proficiency in the course competencies through the following assessment scoring guide criteria:

  • Competency 1: Analyze financial environments and concepts.
    • Explain which capital budgeting method is superior—NPV, IRR, or MIRR.
  • Competency 2: Apply financial computations and processes.
    • Calculate five capital budgeting problems correctly.
  • Competency 3: Communicate effectively and professionally.
    • Convey clear meaning through appropriate word choice and usage.

 

RESOURCES:

Capital Budgeting 

The following resources explore the concept of capital budgeting, which is an important element for business investment.

  • Cornett, M., Adair, T., & Nofsinger, J. (2019). M: Finance (4th ed.). McGraw-Hill. Available in the courseroom via the VitalSource Bookshelf link.
  • https://courses.vitalsource.com/
  • https://capella.vitalsource.com/#/books/9781260139815/cfi/6/2!/4/2/2/2@0:0
    • Chapter 13, “Weighing Net Present Value and Other Capital Budgeting Criteria.”
  • Capital Budgeting.
    • Introduces the concept of capital budgeting.

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