Compute the project expected npv and standard deviation

Reference no: EM1376282

Huang Industries is planning a proposed project whose estimated NPV is twelve million dollar. This estimate suppose that economic situations 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 ($70 million)
Below average 0.20 (25 million)
Average 0.50 12 million
Above Average 0.20 20 million
Boom 0.05 30 million

Compute the project's expected NPV, standard deviation, and coefficient of variation.

Reference no: EM1376282

Questions Cloud

Explanation of yield curve : The following statement was released through FOMC following recent meeting on March 21. The Group, although hopeful for a future of moderate growth with moderating inflation,

Example on precision tree - basic tree terminology : The Westhouser Paper Company in the state of Washington currently has an option to purchase a piece of land with good timber forest on it. Example on precision tree - Basic Tree Terminology

Gross domestic product effect on computer hardware industry : Make an in depth analysis on how your prediction of indicators Gross Domestic Product, Producer Price Index and Retail Sales or PC Retail Sales will effect the Dynamic Random Access Memory industry.

Consumer price index calculation : The agency of Labor Statistics follows 5-steps to calculate Consumer Price Index. Determine three strengths and three weaknesses of the Consumer Price Index calculation.

Compute the project expected npv and standard deviation : Huang Industries is planning a proposed project whose estimated NPV is twelve million dollar. This estimate suppose that economic situations will be average.

Evaluate what is the under absorbed overhead : Find how much overhead is allocated and evaluate what is the over/under absorbed overhead - Make a job order cost sheet for the 100 widgets

Housing industry overview paper assignment : Using the two economic indicators selected for your Housing Industry Overview Paper assignment, Compare and contrast at least two different eighteen month forecasts for each of the 2-economic indicators.

Find how much overhead is allocated : Find how much overhead is allocated and evaluate what is the over/under absorbed overhead?

Evaluate tax savings from the special tax treatment : Daniel's marginal tax rate is 35% and he has $120,000 of other capital gains (taxed at 15 %), evaluate the tax savings from the special tax treatment?

User Account

All Pages