Capital Budgeting—Theory and Practice

For a fuller discussion of this problem, see Solomon Ezra , “The Arithmetic of Capital Budgeting Decisions,” Journal of Business, Vol. XXIX, No. 2 (April, 1956), 124–129.

The methods suggested in this paper are largely a development of the model set up by Ezra Solomon in “Measuring a Company's Cost of Capital,” Journal of Business, Vol. XXVIII, No. 4, pp. 240–252.