DEFINITION of 'Capital Investment Factors'

Factors affecting the decisions surrounding capital investment projects. Capital investment factors are elements of a project decision, such as cost of capital or duration of investment, which must be weighed in order to determine whether an investment should be made, and if so, in what manner the investment is best made in order to maximize utility for the investor.

BREAKING DOWN 'Capital Investment Factors'

Capital investment factors can relate to almost any aspect of an investment decision, such as regulatory environment, risks associated to the investment, macro-economic outlook, competitive landscape, time to complete a project, concerns of shareholders, governance, probability of success/failure and opportunity costs, to name a few. All factors should be examined before coming to a final decision on capital investment projects.

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