The preferred technique for evaluating most capital investments is

Question

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Net present value (NPV) is the preferred technique for evaluating most capital investments because it takes into account the time value of money by discounting future cash flows. It also considers the initial investment and calculates the net present value of all cash flows over the project's life. A positive NPV indicates that the investment is profitable and should be accepted, while a negative NPV suggests that it is not profitable and should be rejected. The other techniques, such as payback period, discount payback period, and internal rate of return, do not consider the time value of money and may lead to incorrect investment decisions.

The Preferred Technique for Evaluating Most Capital Investments Is