This analysis is conducted following the implementation of an accepted capital project and is intended to improve a firm's forecasting process and to improve the firm's operations The decision rule for this capital budgeting method states a project should be considered acceptable in Its calculated return is greater than or equal to the firm's required rate of retum A capital budgeting analysis that determines If a capital asset should be purchased to take the place of a wom out damned or obsolete existing asset Also called a firm's hurdle rate, it is used as the discount rate in a firm's net present value (NPV) calculations or the basis of comparison for a project's internal rate of return (IRR) The term used to describe the time necessary to recover the original cost of an investment from its expected cash inflows The process of planning and evaluating expenditures on assets whose cash flows are expected to extend beyond one year The discount rate that equates the present value of a capital project's expected cash inflows and its initial cost The acceptance or rejection decision made for this type of project does not affect the acceptance or rejection of another proposed capital project The decision rule for this capital budgeting method states a project should be considered acceptable the difference between its discounted cash inflows and cost is positive A curve showing the relationship between a projects's net present value (NPV) and various discount rates Capital budgeting Independent project Internal rate of return Modified internal rate of return Net present value NPV profile Payback period e if Post-audit analysis Replacement decision int Required rate of retum