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	<title>Sebastian Perrier &#187; investment appraisal</title>
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		<title>Investment Appraisal</title>
		<link>http://blog.sebastianperrier.com/2010/01/investment-appraisal/</link>
		<comments>http://blog.sebastianperrier.com/2010/01/investment-appraisal/#comments</comments>
		<pubDate>Sat, 30 Jan 2010 11:30:25 +0000</pubDate>
		<dc:creator>Sebastian Perrier</dc:creator>
				<category><![CDATA[Finance]]></category>
		<category><![CDATA[internal rate of return]]></category>
		<category><![CDATA[investment appraisal]]></category>
		<category><![CDATA[investment decision]]></category>
		<category><![CDATA[investment opportunities]]></category>
		<category><![CDATA[IRR]]></category>
		<category><![CDATA[net present value]]></category>
		<category><![CDATA[NPV]]></category>
		<category><![CDATA[PAYBACK]]></category>

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		<description><![CDATA[There are four steps in the investment decision:

Identify investment opportunities
Put numbers to each opportunity (this is the most difficult part!)
Evaluate and make a decision (NPV calculation)
Monitor investment and control

In point 3, how to make a decision, there are 3 possible analyses:

PAYBACK PERIOD (ignores time value of money and ignores cash flows after payback period)
INTERNAL RATE [...]]]></description>
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