ABSTRACT
Capital expenditure decisions, commonly known as capital budgeting, is the process of making long-term planning decisions for alternative investment opportunities. There are many investment decisions that the company may have to make in order to grow. Examples of capital budgeting applications are numerous. When should old facilities be replaced? Which piece of equipment should be selected to perform a particular operation? Should equipment be leased or purchased? Which product line should be selected? Should the company have one big plant or several smaller ones? Should the firm embark on a new research and development program?
