Page 100 - DBP5043
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CAPITAL BUDGETING CONCEPT
Types of projects:
Capital projects will include introduction of new product or expansion
of the existing products.
Projects can be divided into 2 groups:
1. Independent projects
Cash flow is independent or unrelated to one another, decision to
accept one project will not affect to accept another projects
2. Mutually exclusive
A decision is made to choose only one project from the many being
considered, a decision to accept one project will automatically reject
the others
