|
Preparation
Read “Capital
Investment Analysis & Project Assessment.”
Purpose of Lecture
Making capital investment decisions requires committing large
amounts of money to projects that generate benefits over time.
Assessing these benefits to decide if the investment is profitable
and feasible is the topic of this lecture. The net present value
method of assessing profitability is discussed.
Structure of Presentation
The first half of the presentation presentsh the calculations
of the profitability analysis using net present value; the second
part summarizes the feasibility analysis. An example using on-farm
storage of an identity preserved grain is used in the discussion
to apply the concepts.
Further materials providing the source computations for the on-farm
storage project and source computations and worksheets for another
example, a dairy expansion, are provided in the excercises.
|
