Factors Affecting Business Decision Making

Business decision making

TABLE OF CONTENTS
INTRODUCTION......................................................................................................................3
Evaluating the feasibility of investment proposals for A&B plc...........................................3
Different factor considers at the time of making financial decision......................................6
CONCLUSION..........................................................................................................................7
REFERENCES...........................................................................................................................8

INTRODUCTION
The decision making process is an integral part of every business organization which
provides support in effective management of the business. Through effective decisions only,
the business can be run smoothly along with achieving the desired aims and objectives. This
essays states about the different investment appraisal technique that can be utilized by the
company A&B plc in taking decisions along various factors affecting the decision making
process.
Evaluating the feasibility of investment proposals for A&B plc
In this, there are two projects from which one is required to be accepted and in order to know
that NPV and the payback period of both the projects is being evaluated and given below.
Net present value
NPV can be considered as the estimation of the anticipated incomes which is
determined by the changing over the future incomes to the current worth (Willigers, Jones
and Bratvold, 2017). This strategy is helpful in deciding the productivity related with the task
or the investment plan.
Project A
Computation of NPV
Year
Cash
inflows
PV factor
@ 14%
Discounte
d cash
inflows
1 30000 0.877 26315.8
2 35000 0.769 26931
3 40000 0.675 26999
4 60000 0.592 35525
5 90000 0.519 46743
Total discounted cash
inflow 162514
Initial investment 120000