question archive A project has an initial investment of 100
A project has an initial investment of 100
Subject:AccountingPrice: Bought3
A project has an initial investment of 100. You have come up with the following estimates of the project's cash flows (there are no taxes):
Revenues Costs
Pessimistic 15 8
Less likely 17 8
Most likely 20 8
Optimistic 25 8
Suppose the cash flows are prepetuities and the the cost of capital is 10%. Conduct a sensitivity analysis of the project's NPV to variations in revenues. Match your answers with the four relevant conditions (pessimistic, less likely, Mostly, Optimistic).
