In this paper, we develop a methodology for capital budgeting using Delphi method and linear goal programming. Furthermore, we demonstrate how such a model can be applied to allocate budget among different projects which are compet ing for limited resources.Linear goal progamming (LGP) is commonly used to determine the optimal allocation of resources to different alternatives LGP recognizes the existence of multiple conflicting objectives. Each objective is expressed as a goal. The achievement function serves to minimize the deviation of the allocation from some pre-specified targets. Despite the fact that LGP provides optimal solutions, its drawback is that the decision maker must specify goals and priorities a priori. To overcome this problem, the Delphi method, a systematic procedure to obtain a consensus from a group of participants, is suggested. It is conducted prior to goal programming to ( ) identify the goals, (2) determine priorities among the goals, and (3) establish a target level for each goa).
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