Investment Appraisal Methods

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Before investing, investors should assess a project or investment instrument by applying fundamental analysis to identify profitability, market trends, etc. This analysis includes the size of the initial investment, discount, cash flow, or rate of return. There are several investment assessment methods that are often used by investors, such as:
Return of Investment (ROI), Internal Rate of Return (IRR), Average Rate of Return (ARR), Net Present Value (NPV), Payback Period (PB), Profitability Index (PI), Discounted Payback Period (DPB) etc.