Topic_09_E2 - Topic 9, Exercise 2 Capital Budgeting...

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Topic 9, Exercise 2 Capital Budgeting Expenditures The article entitled, “Equipment Expenditures since 1995: The Boom and Bust,” addresses economic considerations related to investment by firms. Once you have read this article, answer the following questions: 1. Did the author’s research show that the recent decline in expenditures was related solely to reduction in technology expenditures? While it is true that expenditures for technology and software have substantially declined in recent periods, other traditional areas of investment expenditures have declined by nearly the same magnitude in recent quarters. According to the author, technology expenditures have declined by about 10%, but expenditures on transportation equipment declined by 13%. The decline in investment was not limited to technology. 2. What three factors does the author identify as driving investment by businesses? The author identified three factors that are likely to drive investment.
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This note was uploaded on 09/13/2011 for the course FIN 6301 taught by Professor El-asmawanti during the Fall '09 term at University of Texas at Dallas, Richardson.

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Topic_09_E2 - Topic 9, Exercise 2 Capital Budgeting...

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