Question: Risk in capital projects is the probability that a project will earn less than expected. Make up and describe one hypothetical project in each of

Risk in capital projects is the probability that a project will earn less than expected. Make up and describe one hypothetical project in each of the replacement, expansion, and new venture categories. List a few ways that each might go wrong and cause the cash flows to be less favorable than expected. Can you think of situations in which projects could result in losses? Could the losses exceed the initial investment (C0)?

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