Similar Search Results

CAPM and capital budgeting: present versus future, equilibrium versus disequilibrium, decision versus valuation

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2007

This paper deals with the use of the CAPM for capital budgeting purposes. Four different measures are deductively drawn from this model: the disequilibrium Net Present Value, the equilibrium Net Present Value, the disequilibrium Net Future Value, the equilibrium Net Future Value. While all of...

Persistent link: https://www.econbiz.de/10005055505

Aggregate Return on Investment for Investments under Uncertainty

Magni, Carlo Alberto - 2017

This paper deals with capital budgeting decisions under uncertainty. We present an Aggregate Return On Investment (AROI), obtained as the ratio of total (undiscounted) cash flow to total invested capital and show that it is a genuine rate of return which, compared with the risk-adjusted cost of...

Persistent link: https://www.econbiz.de/10012973932

Correct or incorrect application of CAPM? Correct or incorrect decisions with CAPM?

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2007

) CAPM capital budgeting decision-making based on disequilibrium NPV is deductively inferred by the Capital Asset Pricing … Model, (ii) the use of the disequilibrium NPV is widespread in finance both as a decision rule and as a valuation tool, (iii …’s (2005) project valuation method, on the basis of which Magni’s criticism to NPV is objected, leaves decision makers open to …

Persistent link: https://www.econbiz.de/10005836868

Sensitivity Analysis and Investment Decisions : NPV-Consistency of Straight-Line Rate of Return

Marchioni, Andrea - 2020

The economic reliability of a performance metric depends on its consistency with the Net Present Value (NPV). We use the new notion of strong NPV-consistency for comparing the Straight-Line rate of return (belonging to the class of AIRR metrics) and the traditional Internal Rate of Return (IRR)....

Persistent link: https://www.econbiz.de/10012855417

Investment Decisions and Sensitivity Analysis : NPV-Consistency of Rates of Return

Marchioni, Andrea - 2018

Investment decisions may be evaluated via several different metrics/criteria, which are functions of a vector of value drivers. The economic significance and the reliability of a metric depend on its compatibility with the Net Present Value (NPV). Traditionally, a metric is said to be...

Persistent link: https://www.econbiz.de/10012931080

Ambiguita Nell´Applicazione del CAPM per la valutazione degli investimenti

Magni, Carlo Alberto - MASTER CONSULTORES - 2009

Il presente lavoro tratta del classico criterio di capital budgeting derivato dal CAPM,secondo il quale un investimento è conveniente se e solo se il suo tasso di rendimento atteso è maggiore del costo del capitale. Tale criterio è esposto, tra gli altri, da Rubinstein (1973) ed è...

Persistent link: https://www.econbiz.de/10010763038

Economic profit, NPV, and CAPM: Biases and violations of Modigliani and Miller's Proposition I

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2005

investor might undertake and is often found by making recourse to the Capital Asset Pricing Model. This paper shows that the …

Persistent link: https://www.econbiz.de/10011108248

CAPM-based capital budgeting and nonadditivity

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2006

This paper deals with the CAPM-derived capital budgeting criterion, and in particular with Rubinstein’s (1973) criterion, according to which a project is profitable if the project rate of return is greater than the risk-adjusted cost of capital, where the latter depends on the project’s...

Persistent link: https://www.econbiz.de/10011267900

Firm Value and the mis-use of the CAPM for valuation and decision making

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2005

This paper shows that a decision maker using the CAPM for valuing firms and making decisions may contradict Modigliani … disequilibrium NPV for decision-making is deductively drawn from the CAPM, its use for both valuation and decision should be rejected. …

Persistent link: https://www.econbiz.de/10004980381

Economic profit, NPV, and CAPM: Biases and violations of Modigliani and Miller's Proposition I

Magni, Carlo Alberto - Volkswirtschaftliche Fakultät, … - 2005

investor might undertake and is often found by making recourse to the Capital Asset Pricing Model. This paper shows that the …

Persistent link: https://www.econbiz.de/10005616790