Reflect on use of the NPV methodology -its benefits, its shortcomings.

Why is the NPV tool so powerful?

What are its shortcomings?

What data do you need to conduct an analysis using NPV?

What are other alternative methodologies presented in the chapter and how does NPV stack up against them?

Have you used this methodology in your work or even in your personal decision when selecting among alternatives?

How does your firm decide on the discount rate?

How careful should the decision maker be in interpreting the results of the NPV analysis?

Net Present Value (NPV) methodology for evaluation alternative approaches in the rational decision process.