Jul 23, 2013 · Capital budgeting methods relate to decisions on whether a client should invest in a long-term project, capital facilities & equipment. Identify a capital project by its functional needs or opportunities. Many capital projects are also identified as a result of risk evaluation or strategic planning. Capital market is a mechanism to flow fund from the hands of small savers (individuals and institutions) at low costs to those entrepreneurs who do need fund to start business or to business. In the other words, capital market mechanism gives a part ownership of big companies/corporations to small savers like you and me.
There are three different markets in which stocks are used as the capital market instruments: the physical, virtual, and auction markets. Bonds, however, are traded in a separate bond market . This market is also known as a debt , credit , or fixed income market.