economic appraisal

Quick Reference

A method of capital budgeting that makes use of discounted cash flow techniques to determine a preferred investment. However, instead of using annual projected cash flows in the analysis, the technique discounts over the project's life the expected annual economic costs and economic benefits. It is mainly used in the assessment of governmental or quasi-governmental projects, such as road, railway, and port developments.

Subjects: Financial Institutions and Services — Accounting.

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