This discussion paper proposes a new decision rule for economic investment theory, the Cost Decision, and describes a new discount approach for Net Cost Projects and the Net Present Cost Formula. The paper illustrates the problems faced internationally, at all levels of government, of assessing...

This paper shows that a decision maker using the CAPM for valuing firms and making decisions may contradict Modigliani and Miller’s Proposition I, if he adopts the widely-accepted disequilibrium NPV. As a consequence, CAPM-minded agents employing this NPV are open to arbitrage losses and miss...