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Capital Budgeting, Intertemporal Programming Models, With Particular Reference To Agriculture

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  • Rae, Allan N.

Abstract

Investment decision processes typically involve the selection of projects, the timing of their initiation and the determination of the amount to be invested in each time period. A linear programming model considered appropriate for solving such models is described, in which the multi-dimensional criterion function is expressed as a linear combination of the appropriately-weighted objectives. An empirical application is then discussed, the objectives of the firm being the maximization of tax-free cash and assets on hand at the end of the planning period. Finally, the appropriate length of the planning horizon, and some approaches to capital budgeting under non-certainty, are discussed.

Suggested Citation

  • Rae, Allan N., 1970. "Capital Budgeting, Intertemporal Programming Models, With Particular Reference To Agriculture," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 14(1), pages 1-14, June.
    • Handle: RePEc:ags:ajaeau:22812
    DOI: 10.22004/ag.econ.22812
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    References listed on IDEAS

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    1. S. R. Johnson & K. R. Tefertiller & D. S. Moore, 1967. "Stochastic Linear Programming and Feasibility Problems in Farm Growth Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 49(4), pages 908-919.
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    10. Dale Colyer, 1968. "A Capital Budgeting, Mixed Integer, Temporal Programming Model," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 16(1), pages 1-7, March.
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    Cited by:

    1. Mallawaarachchi, Thilak & Hall, Nigel H. & Phillips, Brian, 1992. "Investment in Water Saving Technology on Horticultural Farms," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 60(02-1), pages 1-14, August.
    2. Nuthall, Peter L., 1980. "A Survey of Methods for Determining A Planning Horizon," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 48(01), pages 1-15, April.

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