Question
Suppose the CFO wants you to do a scenario analysis with different values for the cost savings, the machine's salvage value, and the working capital
Suppose the CFO wants you to do a scenario analysis with different values for the cost savings, the machine's salvage value, and the working capital (WC) requirement. She asks you to use the following probabilities and values in the scenario analysis: Scenario Probability Cost Savings Salvage Value WC Worst case 0.30 $ 88,000 $28,000 $40,000 Base case 0.40 110,000 33,000 35,000 Best case 0.30 132,000 38,000 30,000 Calculate the project's expected NPV, its standard deviation, and its coefficient of variation. Do not round intermediate calculations. Round the monetary values to the nearest dollar and a coefficient of variation to two decimal places. Negative values, if any, should be indicated by a minus sign. The project's expected NPV: $ Standard deviation: $ 37250 Coefficient of variation: 1.03.
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