Hi there! I'm trying to explain briefly in the end of my assignment how the Net Present Value (NPV) formula is used for the capital budgeting decision. I'm finding it hard to step back and actually explain the method instead of just doing. Does this make sense/is this explained right:

To then include the country risk into the capital budgeting decision, the discount rate can be adjusted based on the country risk. Once adjusted, it is imputed into the Net Present Value (NPV) formula. Future cash flows are then modified by the discount rate, which makes the NPV a better method as it considers time periods and risk involved. If the NPV is positive (the total of all discounted cash flows are positive), it will result in profit.

Further evaluation can be conducted by adjusting the cash flow estimates based on how they are affected by each risk. This will determine the probability distribution of the NPV.

I don't think this explanation is really explaining it all correctly.... thanks in advance for your help!