Solutions to Chapter 1

(a) Calculate the expected net present value (ENPV) of the investment proposal. (10 marks) (b) Calculate the net present value of the worst possible outcome. (5 marks) (c) Comment on the results of your calculations in (a) and (b) above. (2 marks) (d) Discuss the weaknesses of the ENPV approach for decision-making purposes. (3 marks) (20 marks) 6. ................
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