What is the equity method related to investment evaluation ?

There is a large number of investment evaluation techniques. They can be distinguished into two groups - statistical methods and dynamic methods.

Static methods

They focus especially on monitoring of cash benefits or measuring of the initial expenditures. They don’t include a risk factor and take the time into account only in a limited extent:

• Average Annual Return
• Average Payback Period
• Average Percentage Return
• Payback Period

Dynamic methods

They take into account the time and risk factor, the basis is discounting of input parameters.

• Net Present Value
• Internal Rate of Return
• Profitability Index
• Payback Period
• Accounting-Based Profitability Measures