Capital budgeting, working capital and dividend decisions

Capital budgeting decides where to commit large, long-term money: a new plant, a machine, a product line. The question is always whether future cash inflows, discounted to today, exceed the investment. Worked example: investing ₹1,00,000 today for ₹30,000 a year for 4 years at 10% gives present value 30,000 × 3.1699 = ₹95,097 — below the cost, so NPV is negative and the project should be rejected.