Capital Project

What is a 'Capital Project'

A capital project is a long-term investment made in order to build upon, add or improve on a capital-intensive project. A capital project is any undertaking which requires the use of notable amounts of capital, both financial and labor, to undertake and complete. Capital projects are often defined by their large scale and large cost relative to other investments requiring less planning and resources.

BREAKING DOWN 'Capital Project'

Infrastructure projects such as roads, railways and dams are the most common examples of capital projects in the public sphere. Capital projects are also common in the corporate world as well, as firms will allocate large sums of resources in order to build upon or maintain capital assets, such as machinery or a new mining project. In both cases, capital projects are typically planned and debated for a long period to determine the most efficient and resourceful method of completion.

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RELATED FAQS
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    Learn how companies determine how much debt is acceptable when funding a new project by using the net present value to estimate ... Read Answer >>
  2. Do you discount working capital in net present value (NPV)?

    Learn why changes in net working capital (NPV) should be included in net present value calculations for analyzing a project's ... Read Answer >>
  3. How do you calculate costs of capital when budgeting new projects?

    Discover how a company should estimate its costs of capital when budgeting for a new business project using the weighted ... Read Answer >>
  4. How do you use discounted cash flow to calculate a capital budget?

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    Understand what a bank guarantee is and learn why it is so important to the risk and safety of a long-term project contract Read Answer >>
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