Question
You are a junior financial analyst at CSU Corp. and evaluate the NPV of a project for your boss under different scenarios. So far, you
You are a junior financial analyst at CSU Corp. and evaluate the NPV of a project for your boss under different scenarios. So far, you can see the projects NPV is +$40,200 when evaluated at a discount rate of 12%, but -$13,200 when evaluated at a discount rate of 17%. CSU Corps actual discount rate is 15%. Your boss is upset, and wants an answer on whether the project looks good. What do you tell him?
The project should be taken, as its positive NPV.
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The project should not be taken, as its negative NPV.
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Its going to be close, but I have to re-run the numbers and evaluate whether the project should be taken.
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Im outta here! It's been fun while it lasted boss! |
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