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Published in:
2022 | OriginalPaper | Chapter
6. Measures of Investment Worth
Author : Teddy Steven Cotter
Published in: Engineering Managerial Economic Decision and Risk Analysis
Publisher: Springer International Publishing
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Abstract
Investing in productive assets requires not only the availability of money but also sound, relevant decision criterion. Equivalence provides the basis on which cash flows can be adjusted to account for the interest that must be paid on borrowed or invested money to compensate for the riskiness each alternative. In this chapter, we will explore two criteria used primarily for short-term investments and the four primary criteria used for medium-term and long-term investments.