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Uncertainty

Understanding the Unpredictability of Future Investment Returns

December 13, 2023

Can you explain the concept of capital budgeting risk and uncertainty?

Capital budgeting risk involves measurable variability, while uncertainty represents unknown outcomes in future cash flows of investment projects. Techniques like sensitivity analysis or scenario planning help manage and evaluate these factors in investment decision-making.

Tags : Capital Budgeting , Risk Assessment , Uncertainty

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