Evaluating Capital Investments

Abstract

“Let it be said, right at the outset, that there is no magic formula which guarantees making the right decision in each investment case. Moreover, the fact that the answer has been disseminated from a computer in reams of paper enhances the quality of the decision not one bit. Garbage in garbage out should be written large on the wall of any capital project decision maker's office. It is sad to think of the time that is often wasted running and re‐running programmes in order that the Return on Investment percentage, to two decimal places, can be moved to what is considered an acceptable level. All this effort at a time when the inputs to the system are in round thousands!”

Citation

Whittaker, J., Maine, H. and Wilkinson, C. (1990), "Evaluating Capital Investments", Management Research News, Vol. 13 No. 3/4, pp. 38-40. https://doi.org/10.1108/eb028072