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Which assessment method will you adapt while financing a project of small business? a. IRR b. NPV c. Payback period

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Question ajoutée par Vinod Jetley , Assistant General Manager , State Bank of India
Date de publication: 2014/07/23
VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
par VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Net Present Value -- Internal Rate of Return--  Payback period

in the order but as per the project.

SAIF Rehman
par SAIF Rehman , Accountant , Eco Smart Light Trading LLC

NPV and IRR are the best methods for financing the project of small business. if NPV is positive then we mostly accept it except in some cases and we prefer greater IRR

Vinod Jetley
par Vinod Jetley , Assistant General Manager , State Bank of India

In the olden days (and even now) Marwaris preferred 'Payback period' method when they decide to invest in any new project. Shorter the 'payback period' less risky the project.

However, banks finance a project through the NPV(Net present value) method.

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