Impact of investment types and firm characteristics on capital budgeting techniques

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dc.contributor.authorHemawathy, Jessica A/P Rajah
dc.date.accessioned2014-09-05T02:25:36Z
dc.date.available2014-09-05T02:25:36Z
dc.date.issued2005-05
dc.description.abstractCapital budgeting decision is a crucial decision for firms. Various capital budgeting techniques are available to help firms in proper analysis of investment projects. Each technique has its own strengths and limitations. Thus this study was conducted with the objectives to identify which technique is used more extensively for evaluating different types of investment projects and to examine the impact of firm characteristics on the use of capital budgeting techniques for a given type of investment. The study was conducted using a set of questionnaire. Some interviews were also conducted in order to gather richer information. The survey was directed to the Finance and Accounting department of manufacturing firms operating in the northern region of Malaysia. The findings of the study revealed that discounted cash flow methods are used to the same extent in evaluating all three types of project. Payback period method and non-financial technique are used most in evaluating expansion into new product. Accounting rate of return is used to the same extent in evaluating both types of expansion projects. Firms do not just rely on one method to make a decision. Except product standardization, all other firm characteristics which include environmental uncertainty, firm strategy, size and ownership of company selectively moderate the choice of capital budgeting techniques for certain type of project. It is hoped that this study will help firms to understand that different capital budgeting techniques are suitable to evaluate projects with different risks and objectives under different organizational context.en_US
dc.identifier.urihttp://hdl.handle.net/123456789/77
dc.language.isoenen_US
dc.subjectBusiness Administrationen_US
dc.subjectInvestmenten_US
dc.subjectFirmen_US
dc.subjectCapital Budgetingen_US
dc.titleImpact of investment types and firm characteristics on capital budgeting techniquesen_US
dc.typeThesisen_US
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