Abstract
This paper describes the philosophy and construction of a computer program which has been used to alleviate the problems normally associated with DCF (discounted cashflow) techniques for investment appraisal, especially with respect to advanced machine tools. The parameters for evaluating a single machine tool purchase are listed, together with a discussion of the practical problems of evaluating these factors within an industrial environment. It is shown that many of the assumptions made in past publications relating to financial evaluation are in error and do not allow for the constraints normally encountered in industry. A companion paper describes a range of case studies of the practical application of the program within industry with respect to the purchase of advanced machine tools.
Get full access to this article
View all access options for this article.