Capital Budgeting Decisions with Post-Audit Information

Abstract

This dissertation investigates using post-audit information in capital budgeting decisions. The effects of cash flow realizations, incorporated by Bayes theorem, on cash flow estimates represented as probability functions are examined. This research develops modeling techniques, and concepts that incorporate the user's strength of belief in his input information and in the available sample information. These concepts are then applied to case studies of actual decision problems. As the revision procedures generate the uncertainty, resolution for the project cash flows, it is helpful to have a graphic illustration. This research develops Cash Flow Control Charts as a management tool. These charts are similar to statistical quality control charts, but incorporate Bayesian revision. The methods lead to improved decision making. Keywords: Decision science; Economic analysis; Bayesian analysis; Replacement problem. Theses.

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Document Details

Document Type
Technical Report
Publication Date
Jun 08, 1990
Accession Number
ADA222418

Entities

People

  • George C. Prueitt

Organizations

  • Auburn University

Tags

Communities of Interest

  • C4I
  • Human Systems
  • Space

DTIC Thesaurus Topics

  • Artificial Intelligence
  • Bayes Theorem
  • Bayesian Networks
  • Business Administration
  • Case Studies
  • Computational Science
  • Computer Simulations
  • Computers
  • Data Science
  • Economics
  • Money
  • Operations Research
  • Probability
  • Probability Distributions
  • Random Variables
  • Surveys
  • Theorems

Readers

  • Adaptive Control and Estimation with Uncertainty in Dynamic Systems.
  • Computer Science.
  • Naval Personnel Management

Technology Areas

  • AI & ML
  • AI & ML - Bayesian Inference
  • AI & ML - Machine Learning Algorithms