a. Investment appraisal for mining company versus municipal assembly
Mining company is a profit making company but municipal assembly is a not-for-profit
organization. Their investment appraisal objectives will be different

• Very few municipal assemblies’ will have capital investment with the view to making
  financial returns. Even where this is done, the objective is not for distributing the profits
  to shareholders
• On the decision about mutually exclusive projects, a mining company will prefer a
  project with the highest NPV. But a municipal assembly will prefer the highest social
  benefit over financial benefit
•  A municipal assembly will be dependent on an interest rate set by government for its
  investment appraisal analysis. But a mining company will use a commercial rate of
  return which may be internally determined or by market forces.
• A municipal assembly may invest in public infrastructure and community development.
  But a mining company may invest in noncurrent assets such as Plant and machinery,
  research and development and advertising
• A municipal assembly will depend on cost-benefit analysis instead of financial analysis
  for a decision on investment projects. But a mining company will depend on discounted
  cash flow analysis that takes accounts of time value of money for its analysis
•  A municipal assembly may go beyond an NPV analysis to use the total welfare analysis
  which may include benefits not measurable in monetary terms. This may lead to
  prioritising a negative NPV project. A mining company with a profit focus will not
  accept a project with negative NPV
• Cost benefit analysis is considered superior to a municipal assembly where as a
  discounted cash flow analysis is considered superior for a mining company which will
  be profit focused.