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Using the net present values (NPVs) and associated probabilities for projects X and Y summarized in the table below. NPVs (N$) -15,000 0 15,000 25,000
Using the net present values (NPVs) and associated probabilities for projects X and Y summarized in the table below. NPVs (N$) -15,000 0 15,000 25,000 30,000 35,000 40,000 45,000 55,000 70,000 Project x Probability 0.01 0.03 0.03 0.05 0.15 0.50 0.15 0.05 0.03 0.00 NPVs(N$) -20,000 -10,000 0 10.000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 Project Y Probability 0.00 0.02 0.04 0.06 0.08 0.15 0.35 0.20 0.05 0.03 0.01 0.01 0.00 (i). Calculate the expected NPV for each project. (2 marks) (ii). Calculate the standard deviation for each project (4 marks) (iii). Calculate the coefficient of variation of the possible NPVS.(2 marks)
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