Capital Budgeting (5 cr)

Learning outcomes

The student is able to
- set up a discounted cash flow analysis
- use investment criteria to determine whether or not a project is acceptable
- use scenario analysis, sensitivity analysis and risk analysis in decision making
- write an investment proposal for management
- use computer software in capital budgeting

Location and time

In Leppävaara campus. The schedule can be found in Pakki.

Teaching methods

Introduction to capital budgeting theory and practices (lectures and literature reviews)
Individual Excel assignments
Team assignments using capital budgeting software (Invest for Excel)

Capital budgeting is the process of deciding whether or not to undertake an investment project. Should we start a new production line? Should we buy new machinery? Is this project profitable? Yes? No? The management needs to answer these kinds of questions and needs support in making important decisions about the future.

Employer connections

Datapartner, Cash flow modelling

Evaluation scale

H-5

Qualifications

Profitable Business 1 and 2 (or equivalent knowledge)