search query: @indexterm capital budgeting / total: 390
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| Author: | Cornell, B. |
| Title: | Risk, duration, and capital budgeting: New evidence on some old questions |
| Journal: | Journal of Business
1999 : APR, VOL. 72:2, p. 183-200 |
| Index terms: | Companies Capital budgeting Risk Bio-technology CAPM Models Case studies |
| Language: | eng |
| Abstract: | In a provocative article Campbell and Mei suggest that systematic risk arises not because of correlation btw. company's cash flow and the market return but primarily because of common variation in expected returns. If true, the hypothesis of Campbell and Mei has important implications for capital budgeting, particularly at high-tech companies having long duration, idiosyncratic investment projects. In the article, some new evidence related to the Campbell-Mei hypothesis are presented and then the impact of the hypothesis is evaluated with a case study of Amgen Corporation. |
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