The Selection Process for Capital Projects

Reviews basic principles and presents techniques for evaluating and making decisions about investments and the acquisition of capital projects in industry and the private sector. Provides management and control techniques for construction of facilities or installation and operation of machinery and equipment. Covers sensitivity analysis and methods for ranking projects. Discusses the limitations of various methods. Explains how to carry out economic studies for the proper allocation of capital spending. Partial table of contents:

Capital Projects in the National Economy.

BASIC ENGINEERING ECONOMY.

Cash Flow Patterns.

Rates of Return.

The Three Worths.

The Internal Rate of Return.

Benefit-Cost Analysis.

THE SELECTION PROCESS: ECONOMIC ANALYSIS.

Ranking for Financial Exclusivity.

Retirements and Replacements.

Public Projects and Regulated Industries.

Criticisms of Economic Analysis.

THE SELECTION PROCESS: RISK ANALYSIS.

Sensitivity Analysis.

Probability: Part 2.

Uncertainty.

THE SELECTION PROCESS: MULTIATTRIBUTE ANALYSIS.

Multiattribute Analysis Techniques.

Multiattribute Analysis: AHP and Risk Preference.

Appendices.

Index.

Hans J. Lang and Donald N. Merino are the authors of The Selection Process for Capital Projects, published by Wiley.