Corporate goals

Identify and describe a long-term investment project (either real or fictional) that would likely require significant capital commitment.

Why might companies disregard a positive NPV? MIT professor of financial economics Stewart C. Myers asserts that different decision rules might apply when investments are long-term rather than short-term (Myers, 1977). Financial managers may rationalize that it is in their immediate interest to invest in short-term projects because they bring the most shareholder benefits; this […]

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