Which of the following is NOT a step in the capital budgeting process?
A) Identify the initial outlay of the investment project.
B) Estimate net future cash flows over the lifetime of the project.
C) Identify appropriate interest rate to discount the future cash flows.
D) Use foreign inflation rates to discount the future cash flows.

Question

Quizplus · Accepted Answer

Using foreign inflation rates to discount future cash flows is not a step in the capital budgeting process. The appropriate interest rate to discount future cash flows is determined based on the risk associated with the investment project, but foreign inflation rates are not typically used in this calculation.

Which of the Following Is NOT a Step in the Capital