Consider the following statement: We like to do all our capital budgeting calculations in real terms. It

Question:

Consider the following statement: “We like to do all our capital budgeting calculations in real terms. It saves making any forecasts of the inflation rate.” Discuss briefly.

Capital Budgeting
Capital budgeting is a practice or method of analyzing investment decisions in capital expenditure, which is incurred at a point of time but benefits are yielded in future usually after one year or more, and incurred to obtain or improve the...