lnvestment project discounting methods: Pereira's case

Abstract

This paper presents a study that aims at identifying how businesses in the city of Pereira calculate and use the discount rate to evaluate investment projects and examining the factors that influence to determine the discount rate value. The study begins by presenting a state of  the art of discount rate estimations, followed by the company selection methodology, survey design, tabulation and analysis. The results shows little knowledge and use of the discount rate by employers in the city of  Pereira and that those employers who use it do not have clearly defined criteria, consistent with  theoretical estimation approaches.