This study was conducted in two phases; first as a survey and second as a case study. The\nstudy used a cross-sectional survey design to explain the business characteristics influencing\nthe selection of investment evaluation techniques among Tanzanian SMEs. Purposive\nsampling technique was used to collect data to a sample of 301 SMEs drawn from SIDO in\nDar es Salaam and Dodoma regions. Data were collected though questionnaires and\ntransformed into suitable format for analysis using statistical packages for the survey, while\nfor the case study interviews were used. Statistical techniques used in this study were\ndescriptive (frequency distributions) and inferential statistics (multivariate analysis) which\nwere used to determine whether or not there is a relationship between business characteristics\nand selection of investment evaluation techniques. Results of this study shows that, sales\ngrowth, industry of business, level of education and finance education of owners, were the\nbusiness characteristics that influence the selection of investment evaluation techniques.\nTheoretical and practical contributions in the area of investment decisions for SMEs in\nTanzania are made based on the findings of the study. On theoretical contributions, the study provided a better understanding on small business characteristics and how they influenced the\nselection of investment evaluation techniques. On practical contributions, owners should\nmaintain high sales growth; improve education background by attending short courses on\nfinancial management, because these two characteristics significantly affect the selection of\ninvestment evaluation techniques.
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