Inflation in project evaluation

CIM Bulletin, Vol. 83, No. 935, 1990

LD. SMITH, Kilborn Ltd., Toronto, Ontario

Those who Submit competing proposals for projects seek to present senior management with complete and fully supported material that will not fail under questioning. Hopefully, misleading notions and omissions will have been minimized and there will have been testing of the assumptions regarding the economic, social and political environments. A capital project evaluation team can do management and itself a service by including a sound approach to the impact of inflation (and its twin problem, interest) on a project and a great disservice with an inappropriate approach to inflation.
Keywords: Economics, Inflation, Production.