The economic efficacy of shortening the investment period

Gogic, P.

The economic efficacy of shortening the investment period

1996

Gogic, P. (Poljoprivredni fakultet, Beograd - Zemun (Yugoslavia))

This paper deals primarily with the economic importance of shortening the investment period. It discussed the methodological procedure for assessing the economic efficacy of a shorter investment period. Essentially, this procedure takes the form of a comparison between the effect of shortening and the amount of additional investments required for the shortening. The effect of shortening is expected to reflect in the economic benefit for the period during which the execution has been shortened and in the saving of investments due to the calculated intercalary interest for the shorter period. The construction of a drainage system was used in order to assess the economic efficacy of a shorter investent period. Based on the results obtained it can be concluded that it was economically justifiable to shorten the construction period from 3 to 2 years, although enormous capital was required for additional investments.

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