Bullock Gold Essays(Examples)

Capital Budgeting Bullock Gold

… Based on this analysis, the company should open the mine. There are several reasons why. First, there is no rule of thumb for bullock with respect to payback period – and once the project has started it will be finished, so that is not really a great … be undertaken.
The key here is that there are no other projects (options) for comparison. These metrics are great to compare, say, two gold mines to see which one is better. In this case, with only one, bullock gold is faced with a go/no-go decision. Thus, any IRR or MIRR above the cost of capital, or any positive NPV, means that bullock should pursue this gold mine project.
It is worth checking the assumptions that underlie these calculations, of course. The price of gold fluctuates a lot, so there should be a certain margin of error built into the future cash……