A project has an initial investment of 100. You have come up with the following estimates of the projects with cash flows. If the cash flows are perpetuities and the cost of capital is 10%. What does a sensitivity analysis of NPV (no taxes) show?
A) -50, 20, +100
B) -100, -50, +80
C) -50, +50, +70
D) None of the above

Question

A project has an initial investment of 100. You have come up with the following estimates of the projects with cash flows.  If the cash flows are perpetuities and the cost of capital is 10%. What does a sensitivity analysis of NPV (no taxes) show?
A) -50, 20, +100 
B) -100, -50, +80 
C) -50, +50, +70 
D) None of the above

Quizplus · Accepted Answer

The Answer of A project has an initial investment of 100. You have come up with the following estimates of the projects with cash flows.  If the cash flows are perpetuities and the cost of capital is 10%. What does a sensitivity analysis of NPV (no taxes) show?
A) -50, 20, +100 
B) -100, -50, +80 
C) -50, +50, +70 
D) None of the above

A Project Has an Initial Investment of 100