Projects expected NPV on basis of the scenario analysis

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Reference no: EM13911538

Heywood Diagnostic Enterprises is evaluating a project with the following net cash flows and probabilities:

Year Prob = 0.2 Prob = 0.6 Prob = 0.2

0 (100,000) (100,000) (100,000)

1 20,000 30,000 40,000

2 20,000 30,000 40,000

4 20,000 30,000 40,000

5 30,000 40,000 50,000

a. What is the project’s expected NPV on the basis of the scenario analysis?

b. What is the projects standard deviation of NPV?

Reference no: EM13911538

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