Return on Investment (ROI) is not a commonly used capital budgeting technique because it does not consider the time value of money.

The primary objective of capital budgeting is to maximize shareholder wealth by selecting projects that generate positive net present value (NPV) and increase the firm's overall value.

Net Present Value (NPV) and Internal Rate of Return (IRR) are capital budgeting techniques that consider the time value of money by discounting future cash flows back to the present value.

The payback period is the time it takes for a project to generate enough cash flow to cover the initial investment.

The Internal Rate of Return (IRR) is the discount rate that equates the present value of future cash flows to the initial investment.

There is a direct relationship between NPV and IRR. If NPV is positive, IRR is also positive. If NPV is negative, IRR is also negative. If NPV is zero, IRR is also zero.

The Net Present Value (NPV) is most sensitive to changes in the discount rate because it directly uses the discount rate to calculate the present value of future cash flows.

The modified internal rate of return (MIRR) is the IRR calculated using the terminal value of the project.

The Net Present Value (NPV) is best suited for evaluating projects with unequal cash flows because it considers the time value of money and discounts future cash flows back to the present value.

The risk-adjusted discount rate (RADR) is the discount rate that reflects the project's risk.

The Net Present Value (NPV) is best suited for evaluating projects with mutually exclusive alternatives because it considers the time value of money and allows for a direct comparison of the projects' net present values.

The certainty equivalent (CE) of a project is the risk-free cash flow that is equivalent to the project's expected cash flow.

The Net Present Value (NPV) is best suited for evaluating projects with long payback periods because it considers the time value of money and discounts future cash flows back to the present value.

The capital rationing constraint is the constraint that limits the amount of capital available for investment.

The Net Present Value (NPV) is best suited for evaluating projects with positive externalities because it considers the time value of money and allows for the inclusion of the project's positive externalities in the cash flow analysis.