Methods of capital budgeting, also known as “evaluation techniques”, are used by organizations to help make sound investments in long-term assets. These methods help businesses allocate resources over the long-term and derive value from their investments. In short, they often determine which projects have the highest potential for success and should be pursued. Common evaluation techniques include: Payback period, accounting rate of return, net present value (NPV), internal rate of return (IRR), discounted cash flow (DCF) analysis, and real options. All of these methods help weigh costs and expected benefits over a period of time and can assist you in making smart financial decisions for your business.