In capital investment decision making, it is usually assumed that managers should select projects that attempt to maximize the wealth of the owners of the firm.

Question

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The goal of capital investment decision making is to create value for the owners of the firm, which is typically measured in terms of maximizing the firm's wealth or profitability. Therefore, managers should select projects that are expected to generate positive net present value (NPV) or internal rate of return (IRR) and enhance the long-term sustainability of the business. However, managers may also need to consider other factors such as risk, liquidity, and social responsibility when evaluating investment opportunities.

In Capital Investment Decision Making, It Is Usually Assumed That