GB550 week 5 Discussion 1 and 2

GB550 week 5 Discussion 1 and 2

Discussion 1

From a financial manager's perspective, discuss the capital-budgeting process used to identify projects that add to the firm's value? How do capital-budgeting decisions help to define a firm's strategic direction?

 Discussion 2

 When two mutually exclusive projects are being compared, explain why the short-term project might be higher ranked under the NPV criterion if the cost of capital is high; whereas, the long-term project might be deemed better if the cost of capital is low. Would changes in the cost of capital ever cause a change in the IRR ranking of two such projects? Explain.