Question: Question Three: Why are you looking at sensitivity analysis when all you should be looking at is NPV? But before you can answer that question

 Question Three: Why are you looking at sensitivity analysis when all

Question Three: Why are you looking at sensitivity analysis when all you should be looking at is NPV? But before you can answer that question someone else interjects another question: Question Four: wait, NPV is a point estimate and the sensitivity analysis helps us to check what might happen if the cash flow forecasts are off. Isn't that a legitimate point? In answering these questions, address the issue as to whether any of this matters. Would the sensitivity analysis change our rankings of projects that we would have generated just looking at NPV? Be specific. Question Five: I think we should reject Goldie's Square because the only reason it has a positive NPV is because of the positive NPV from credit card sales. Since Target's business is running a retail store, shouldn't we reject any project where the NPV from its retail operations is negative? Question Three: Why are you looking at sensitivity analysis when all you should be looking at is NPV? But before you can answer that question someone else interjects another question: Question Four: wait, NPV is a point estimate and the sensitivity analysis helps us to check what might happen if the cash flow forecasts are off. Isn't that a legitimate point? In answering these questions, address the issue as to whether any of this matters. Would the sensitivity analysis change our rankings of projects that we would have generated just looking at NPV? Be specific. Question Five: I think we should reject Goldie's Square because the only reason it has a positive NPV is because of the positive NPV from credit card sales. Since Target's business is running a retail store, shouldn't we reject any project where the NPV from its retail operations is negative

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!