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  • Cost Wacc Year/Probability Prob NPV Case 1

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    pragatigupta14
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    This document presents a financial analysis comparing the expected net present value (NPV) of 3 investment cases under different probabilities and time periods. Case 1 has a negative expected NPV of -₹0.67. Case 2 has a positive expected NPV of ₹5.35. Case 3 has the highest expected NPV of ₹7.41. A second scenario is presented with different assumptions showing Case 1 has the highest expected NPV of ₹4.61, Case 2 is next at ₹11.42, and a third scenario further analyzes the cases with 6 years and Case 3 again having the best expected NPV of ₹13.93.

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    aSSIGNMENT

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    Assignment 376 PragatiGupta

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    This document presents a financial analysis comparing the expected net present value (NPV) of 3 investment cases under different probabilities and time periods. Case 1 has a negative expected NPV of -₹0.67. Case 2 has a positive expected NPV of ₹5.35. Case 3 has the highest expected NPV of ₹7.41. A second scenario is presented with different assumptions showing Case 1 has the highest expected NPV of ₹4.61, Case 2 is next at ₹11.42, and a third scenario further analyzes the cases with 6 years and Case 3 again having the best expected NPV of ₹13.93.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    Download as xlsx, pdf, or txt
    7 views4 pages

    Cost Wacc Year/Probability Prob NPV Case 1

    Uploaded by

    pragatigupta14
    This document presents a financial analysis comparing the expected net present value (NPV) of 3 investment cases under different probabilities and time periods. Case 1 has a negative expected NPV of -₹0.67. Case 2 has a positive expected NPV of ₹5.35. Case 3 has the highest expected NPV of ₹7.41. A second scenario is presented with different assumptions showing Case 1 has the highest expected NPV of ₹4.61, Case 2 is next at ₹11.42, and a third scenario further analyzes the cases with 6 years and Case 3 again having the best expected NPV of ₹13.93.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as xlsx, pdf, or txt
    of 4

    Cost 50 WACC 0.

    14
    Year/Probability 0 1 2 3 NPV Prob*NPV
    Case 1 0.25 -50 30 30 30 ₹ 19.65 ₹ 4.91
    0.5 -50 25 25 25 ₹ 8.04 ₹ 4.02
    0.25 -50 5 5 5 -₹ 38.39 -₹ 9.60
    Expected NPV -₹ 0.67

    Year/Probability 1 2 3 4
    Case 2 0.25 -50 30 30 30 ₹ 13.93 ₹ 3.48
    0.5 -50 25 25 25 ₹ 3.74 ₹ 1.87
    0.25 0 0 0 0 ₹ 0.00 ₹ 0.00
    Expected NPV ₹ 5.35

    Year/Probability 0 1 2 3 4 NPV
    Case 3 0.25 -30 34 4 34 34 ₹ 45.98
    0.5 -30 20 -10 20 20 ₹ 5.19
    0.25 -30 2 2 0 0 ₹ -26.71
    Expected NPV
    Risk Free Rate 0.06

    Prob*NPV
    ₹ 11.50
    ₹ 2.60
    ₹ -6.68
    ₹ 7.41
    WACC 0.1 Risk Free Rate
    Year/Probability 0 1 2 3 NPV Prob*NPV
    Case 1 0.3 -70 45 45 45 ₹ 41.91 ₹ 12.57
    0.4 -70 30 30 30 ₹ 4.61 ₹ 1.84
    0.3 -70 15 15 15 ₹ -32.70 ₹ -9.81
    Expected NPV ₹ 4.61

    Year/Probability 1 2 3 4 NPV Prob*NPV


    Case 2 0.3 -70 45 45 45 ₹ 35.70 ₹ 10.71
    0.4 -70 30 30 30 ₹ 1.79 ₹ 0.71
    0.3 0 0 0 0 ₹ 0.00 ₹ 0.00
    Expected NPV ₹ 11.42

    Year/Probability 0 1 2 3 4 5 6
    Case 3 0.3 -70 45 45 -25 45.00 45.00 45
    0.4 -70 30 30 -45 30.00 30.00 30
    0.3 -70 15 15 15 0.00 0.00 0
    0.06

    NPV Prob*NPV
    ₹ 73.39 ₹ 22.02
    ₹ 4.31 ₹ 1.72
    ₹ -32.70 ₹ -9.81
    Expected NPV ₹ 13.93

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