Question: Can someone solve this so I can know if I am doing it right? I think I am on the right path... SCENARIO ANALYSIS Huang
Can someone solve this so I can know if I am doing it right? I think I am on the right path... SCENARIO ANALYSIS Huang Industries is considering a proposed project whose estimated NPV is $12 million. This estimate assumes that economic conditions will be average. However, the CFO realizes that conditions could be better or worse, so she performed a scenario analysis and obtained these results:
| Economic Scenario | Probability of outcome | NPV |
| Recession | 0.05 | ($70,000,000) |
| Below Average | 0.2 | ($25,000,000) |
| Average | 0.5 | $12,000,000 |
| Above Average | 0.2 | $20,000,000 |
| Boom | 0.05 | $30,000,000 |
Calculate the projects expected NPV, standard deviation, and coefficient of variation.
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