| Economic appraisal is mainly used as the basis of comparison and selection of different technical operations. For any newly built project or technical improvement scheme, people can hardly make any proper decision until all kinds of technical-economical conditions and influence factors are comprehensively compared and evaluated. Thus it can be seen that economic appraisal is the basis of making proper decision. However, the quality of the economic appraisal is directly dependent on correctness and adaptability of the method of evaluation and computation. So it is very important for properly selecting an economic appraisal method. There are many economic appraisal methods used in and outside China, each of which has its own virtues and defects, and also definite application range. In the paper, the most basic and important methods-net present value method and internal rate of return method are introduced. In order to profoundly understand and perfectly use these two methods, their respective features and usable conditions are discussed in detail. |