Capital budgeting problem (simulation) 1b PDF

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Julie Pisanu 201504310 Isaac Smith 201800020

Capital budgeting problem 1 ( Simulation) Caine-Cleaseau BioPharma ( CCB) Recommendation: After running the trial 300 times, we have received an average NPV of 17,8 million dollar. 25th percentile of the data producing negative NPV . So we will inform our client that 25 % of the time they could experience a loss. Although 75% of the time, there appears to be a gain from the project. Ps: We cannot base our investment decision using IRR with simulation analysis. So we will therefore make our decision solely on NPV approach.

Julie Pisanu 201504310 Isaac Smith 201800020

Julie Pisanu 201504310 Isaac Smith 201800020

Capital budgeting problem 2 ( Simulation) Wally’s water works (WWW)

Recommendation: According to our analysis, WWW is still producing positive NPV after running 300 times trial of simulation. We recommend our client to take the project.

Julie Pisanu 201504310 Isaac Smith 201800020

Julie Pisanu 201504310 Isaac Smith 201800020...