Question: ( 1 ) Sensitivity Analysis. The expected cash flow forecasts are given below in Table 1 for Otobai Company's Motor Scooter project. Table 2 lists
Sensitivity Analysis. The expected cash flow forecasts are given below in Table for Otobai Company's Motor Scooter project.
Table lists three possible scenarios for each relevant variable. The cost of capital for Otobai Co is r For simplicity, when
considering uncertainty, assume that all variables remain constant in billion Yen except the one you are changing, and Table lists
all the NPVs in each possible situation.
Please verify the NPV for at least two situations. I will provide solutions for the two worst NPVs
Table Expected cash flows for the motor scooter project
Table Three possible scenarios Table NPV in each possible situation
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