When deducing the expected NPV of a project, you can: (a) identify all possible outcomes (and their
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When deducing the expected NPV of a project, you can:
(a) identify all possible outcomes (and their individual NPVs) and deduce the expected NPV from them; or
(b) deduce the expected value of each of the inputs and use these to deduce the expected NPV directly.
What are the advantages and disadvantages of each of these two approaches?
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