Calculate the project expected npv

Assignment Help Finance Basics
Reference no: EM13269671

Huang Industries is considering a proposed project whose estimated NPV is $12 million. This estimate assumes that economic conditions will be "average." However the CFO realizes that conditions could be better or worse, so she performed a scenario analysis and obtained these results:

Economic Scenario Probability of Outcome NPV
Recession 0.05 - $48 million
Below average 0.20 - $24 million
Average 0.50 12 million
Above average 0.20 22 million
Boom 0.05 26 million

Calculate the project's expected NPV, standard deviation, and coefficient of variation. Round your answers to two decimal places. Enter your answers for the project's expected NPV and standard deviation in millions. For example, an answer of $13,000,000 should be entered as 13.

 

Reference no: EM13269671

Questions Cloud

Find voltage v1 for which the diode just starts to conduct : Given the following circuit, in which R1 = 200 (Ohm), R2 = 100(Ohm), V1 = 6 V, and V2 = 3 V. Assume the diode turn-on voltage is 0.7 V. Find the current through the circuit. Find the voltage V1 for which the diode just starts to conduct.
Evaluate the ph at the equivalence point : Calculate the pH at the equivalence point for the following titration: 0.10 M HCN versus 0.10 M NaOH. The Kb of CN- = 2.0 x 10-5.
Find probability that none is related to a kidney problem : About 30% of hospital admissions for diabetic patients because of some kidney problems. In a sample of 10 diabetic admissions, find the probability that none is related to a kidney problem?
Is the machines resistance ohmic : welding machine draws a 18A of current at 240V. When it is inadvertently connected to a 120V outlet, the current in it is 10A. Is the machine's resistance ohmic
Calculate the project expected npv : Calculate the project's expected NPV, standard deviation, and coefficient of variation. Round your answers to two decimal places. Enter your answers for the project's expected NPV and standard deviation in millions. For example, an answer of $13,0..
Explain a saturated aqueous solution of lead iodate : A saturated aqueous solution of lead(II) iodate, Pb(IO3)2, contains 3.1 x 10-5 M Pb+2 at 25°C. Assuming an ideal solution, and assuming no reaction of the ions with water, calculate the Ksp of lead(II) iodate at that temperature.
Find the speed of the block immediately after bullet exits : A 2.0kg block of wood sits on a table. A 3.0 g bullet, fired horizontally at a speed of 360m/s, find the speed of the block immediately after the bullet exits
Explain following data and select the best buffer system : Consider the following data and select the best buffer system below to make a buffer with a pH of 10.00.
Estimate the present value of tax benefits from depreciation : Your company is considering a new project that will require $912,000 of new equipment at the start of the project. The equipment will have a depreciable life of 10 years and will be depreciated to a book value of $142,000 using straight-line depre..

Reviews

Write a Review

Finance Basics Questions & Answers

  Treasury responsibilities

What is meant by this term and how should the CFO be involved in this area? Also, how does "risk management" relate to treasury responsibilities?

  Computing the current price of the stock

CPX Corporation just paid a dividend of $1 each share. Analysts expect the company's dividend to increase 10 percent this year and 8 percent the next year.

  Important information about computing loan amount

Assume you're a loan officer for bank. A start-up company has qualified for a loan. You are pondering various proposals for repayment:

  Calculating risk premium

Suppose if WalMart has a beta of 1.1, current risk-free rate is 3.5%, average risk free rate over the last 70 years is 3.2 percent, and the expected return on the stock market is 12.3 percent,

  Computing payment for sales

Suppose each month has thirty days and AmDocs has a sixty-day accounts receivable period. In the second calendar quarter of year (April, May and June), AmDocs will gather payment for sales it made during which of the months listed below?

  Explain usage of the budgeting in business environment

Explain Usage of the budgeting in business environment and Discuss how budgeting can be used at your place of employment

  What is choi cost of new common stock

The Choi's Company's next expected dividend, D1, is $3.18; its growth rate is 6 percent; and its stock currently sells for $36. New stock can be sold to net the firm $32.40 per share. (a) What is Choi's percentage flotation cost? (b) What is Choi'..

  Calculation of equated annual cost

Calculation of Equated Annual Cost and You are evaluating two different silicon wafer milling machines

  What is the representative investor average degree

The expected rate of return on the market portfolio is 8.50% and the risk-free rate of return is 2.50%. The standard deviation of the market portfolio is 24%. What is the representative investor's average degree of risk aversion?

  Administration and enforcement of erisa

How do these agencies below impact the administration and enforcement of ERISA:

  Find the projected incremental cash flow

Nickel Corporation is planning the purchase of a new machine that will cost $178,000, plus an additional $12,000 to ship and install.

  What is the new par value per share

Hexagon declares a four for five reverse split. How many shares are outstanding now? What is the new par value per share?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd