Investment Appraisal

Investment appraisal is the process of evaluating potential investments to determine their viability and profitability. It involves analyzing various factors, such as costs, expected returns, risks, and timescales, to make informed decisions. Common methods used in appraisal include net present value (NPV), internal rate of return (IRR), and payback period analysis. By assessing these aspects, investors can better understand whether a project or opportunity is worth pursuing, ensuring that their resources are allocated effectively to achieve the best possible outcomes. This method helps both individuals and businesses manage financial risks and maximize returns.