If two competitors enter the market in year 1, Nucleon sales per pig drop to 0.9 in year 2.

■ All cash flows other than the fixed cost on January 1 of year 0 are incurred midyear.

Use simulation to model Nucleon’s situation. Based on the simulation output, would you go ahead with this project? Explain why or why not? What are the three key drivers of the project’s NPV? (Hint: The way the uncertainty about the fixed cost is stated suggests using the Cumul distribution, implemented with the RISKCUMUL function. Similarly, the way the uncertainty about the units sold per pig in year 1 is stated suggests using the General distribution, implemented with the RISKGENERAL function. Look these functions up in @RISK’s online help.)